The investment into the hydropower project marks the $40bn Silk Road Fund’s first investment since its launch, Xinhua news agency quoted an official as saying in a post on China’s central bank website.
The deal has been signed on the sidelines of Chinese President Xi Jinping’s visit to Pakistan.
Scheduled to be commissioned in 2020, the 720MW Karot hydropower project is being developed on the Jhelum River in Kahuta tehsil in Rawalpindi district.
The construction is planned to commence this year.
Planned to be developed by a consortium of Pakistani and Chinese companies, the run-of-river hydropower project is expected to generate 3,436GWh of electricity annually to address the country’s power supply shortages.
Under the latest arrangement, Silk Road Fund will invest in a subsidiary of the China Three Gorges, which will in turn invest in the hydropower project.
Silk Road Fund will also extend the loans, if required, by partnering with Export-Import Bank of China and other financial institutions.
China is planning to invest in 3,350MW of hydropower projects in Pakistan.
Image: Chinese investment in hydropower projects is expected to address power supply shortages in Pakistan. Photo: courtesy of markuso / Freeedigitalphotos.net.
