ISLAMABAD: Even before the formal launch of $4.5 billion Dasu hydropower project, the Water and Power Development Authority (Wapda) has terminated two of its key contracts with a Chinese firm, citing ‘fundamental breaches’ of the agreement.
Moving swiftly, Wapda has not only encashed the performance guarantees of the two contracts awarded to China Railway First Group (CRFG) in November 2015 worth Rs5.4bn — but also ordered the contractor to vacate the project area immediately, while calling for fresh tenders to make up for lost time.
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The World Bank is the major financier of the 4,320MW Dasu project. The project’s terminated contracts include the ‘construction of colony and infrastructure’ worth Rs4.806bn and ‘resettlement of village Choochang and construction of Shatial Museum’ worth Rs572 million. Chinese firm accuses authority of acting illegally, vows to seek arbitration. The completion of these two components was considered crucial to the start of construction work at the main project site.
