The International Finance Corporation will invest $100 million in a hydropower plant in Pakistan, a $1.7 billion project the group says will address severe power shortages and spur growth in the region.
The 720MW Karot project, which is expected to be operational in five years, represents the largest hydroelectric project to date for the IFC, the World Bank’s private investment arm. The plant is being developed by the Karot Power Company, a subsidiary of state-owned China Three Gorges, marking the IFC’s first project finance engagement with the firm.
The facility will be built on the Jhelum River in Pakistan’s Punjab Province just east of Islamabad, bringing clean energy to around three million residents in a country suffering from a severe power deficit, according to the IFC. It is expected to generate 3GWh of net energy annually.
“Improving access to electricity in Pakistan is a priority for the IFC and the World Bank Group,” said IFC global director for infrastructure and natural resources Bernard Sheahan.
The institution collaborated with the China Export Import Bank, China Development Bank and Silk Road Fund for the project, which is part of a World Bank Group initiative to mobilise $10 billion in investments to plug Pakistan’s power gap. The group’s exposure to the country is its second-highest of all nations in the region.