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Thursday, May 30, 2024

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Pakistan receives Islamic financial support for national green agenda

The government of Pakistan’s green agenda has received a much-needed boost from Islamic finance, with the signing of three framework financing agreements with the IsDB worth a total of US$180 million.

The agreements will support the development of the Mohmand Dam and Hydropower Plant Project, located in Khyber-Pakhtunkhwa Province, which aims to contribute to energy generation and provide sustainable water resources for agriculture and human consumption, as well as contributing to the regional socioeconomic development in the province.

“The IsDB takes pride in working alongside its partners to support Pakistan in such a strategic project of national importance. We are working with other players from the Arab Coordination Group to develop a multipurpose dam that will not only enhance energy and water supply but also the livelihoods of the local communities and better protect them against floods,” Dr Muhammad Al Jasser, the IsDB Group president, said.

The mega-project is expected to add 800 MW to Pakistan’s installed hydropower capacity and generate approximately 2,862 GWh annually.

It is also expected to support the country’s efforts to achieve its Vision 2025 goal of more than doubling its installed hydropower capacity by 2030, in addition to meeting the sustainable development goals of food security, clean water, clean energy and partnerships for the goals.

Along with the Islamic financing support from the IsDB, the OPEC Fund, the Kuwait Fund for Arab Economic Development and the Saudi Fund for Development will also join in co-financing the project with a total amount of US$410 million. The Mohmand Dam’s first power-generating unit is scheduled to be operational by December 2025.

The Pakistani government is no stranger to Islamic agro finance support from the IsDB; earlier this month, the multilateral bank’s trade finance arm extended US$1.2 billion to the country for integrated trade solutions supporting its energy and agricultural sectors.

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