CapAsia to invest $20m in Pakistan wind farms

The firm’s Islamic Infrastructure Fund, jointly sponsored by the Islamic Development Bank and the Asian Development Bank, will invest in the construction of two wind parks in the province of Sindh.

CapAsia, a private equity firm focused on investments in southeast and central Asia, has committed $20.5 million in equity to the construction of two wind farms in Southeastern Pakistan.

CapAsia said it was making the investment in the wind farms through its Islamic Infrastructure Fund (IIF). The IIF is targeting $500 million, and held a first close on $262 million, according to CapAsia’s website.

The IIF is jointly sponsored by the Islamic Development Bank and the Asian Development Bank, and focuses on developing private water, transport and energy infrastructure, as well as social infrastructure and telecommunications, in the 12 member countries common to both banks.

Pakistan conglomerate Fauji will develop the wind farms in conjunction with the Tapal Group. The wind farms, which will be located in Sindh province, will require a total investment of $260 million, according to a CapAsia statement. The parks should have a total output of 50 megawatts.

CapAsia is a joint venture between South Africa’s Standard Bank and Malaysia’s CIMB Group. CapAsia manages three funds, with total assets of $460 million.

Last month, the Asian Development Bank also loaned $36.8 million to Turkish power company Zorlu Enerji, which will add 50-megawatts capacity to a wind farm in Sindh.

“Acute energy shortages, caused by low investment, are cutting into Pakistan’s economic growth,” Michael Barrow, private sector operations director for the Asian Development Bank, said in a statement.