ISLAMABAD: Japan International Cooperation Agency (JICA) has been granted tax exemption to JPY 2.665 billion ($26 million) loan granted by the Japanese government for the Islamabad – Burhan Transmission Line Reinforcement Project.
The Economic Coordination Committee (ECC) has approved exemption to JICA from all levies and taxes for the loan extended by the government of Japan on concessionary terms for the said project.
The main objective of the project is to improve the reliability of the national grid and to meet the growing demand for electricity transmission through reinforcement of transmission lines necessary for power supply to Islamabad Capital Territory and surrounding areas, thereby contributing to the improvement of economic infrastructure of Pakistan.
The ECC meeting held on Friday chaired by Finance Minister Senator Mohammad Ishaq Dar.
The ECC also considered and approved the draft standard Power Purchase Agreement (PPA), proposed by the Ministry of Water & Power, which will be used as standard template for future PPAs. The draft PPA is a tripartite agreement between Central Power Purchasing Agency, Guarantee Ltd (CPPA) on behalf of ex-WAPDA Distribution Companies, National Transmission and Despatch Company Limited (NTDCL) and the Power Producers.
The ECC approved the proposal of Ministry of Water & Power for GoP guarantee for repayment of loan amount of $140 million, i.e. 40 percent of US $350 million loan amount for the Dasu Hydropower Project. The World Bank will provide guarantee for the remaining $210 million loan amount.
