ISLAMABAD: China has given Pakistan Rs48 billion to complete two nuclear power plants of 2,117 megawatts in Karachi during July-May 2014-15 to swiftly overcome the prevailing energy crisis in the country.
China extended loans amounting to $477.3 million or Rs48 billion for the two nuclear power plants, K2 and K3 during the corresponding period, according to the Economic Affairs Division (EAD).
The total cost of these two power plants is $9.5 billion including the $6.5 billion foreign financing component. The projects were planned during the tenure of Pakistan Peoples’ Party but were approved by the PML-N government in July 2013.
China and Pakistan signed loan agreements for both power plants early last year. Officials said both sides have also agreed to modify the agreements to change the borrower from government of Pakistan to Pakistan Atomic Energy Commission (PAEC).
However, the federal government will be the guarantor and responsible to return the loans. The modifications have been introduced aimed at keeping the huge spending outside budgetary books.
Had the government booked the expenses on nuclear power plants on the budget, it would have been impossible for it to keep the budget deficit around 5% of Gross Domestic Product in the outgoing fiscal year, ending on June 30.
The issue of treatment of spending on Karachi nuclear power plants remained unresolved during last year.
