Saturday, July 20, 2024

Saudi Fund for Development Contributes $240 Million to Support Pakistan’s Energy Transition via Mohmand Multipurpose Dam Project

The Saudi Fund for Development (SFD) has signed a US$240 million loan agreement to support Pakistan’s Mohmand Multipurpose Dam Project, a major hydropower complex that will contribute to Pakistan’s energy security, increase sustainable water supply for agriculture and human consumption and improve resilience to floods.

The agreement was signed by the SFD CEO, Mr. Sultan Abdulrahman Al-Marshad, and the Federal Secretary for Ministry of Economic Affairs, Pakistan, Dr. Kazim Niaz, with the presence of H.E. the Ambassador of the Custodian of the Two Holy Mosques to the Islamic Republic of Pakistan, Mr. Nawaf bin Said Al-Malki. This loan represents a strong partnership between Saudi Arabia and Pakistan in promoting sustainable development and achieving the SDGs.

The Mohmand Multipurpose Dam Project will enhance water and food security, andimprove the standard of living for people living in the Khyber Pakhtunkhwa province, where almost 80% of the population resides in rural areas, boosting the region’s socioeconomic development by creating employment opportunities and reducing poverty levels. The project aligns with SDG-2 (Food Security), SDG-6 (Clean Water), and SDG-7 (Clean Energy) and embodies SDG-17 (Partnerships for the Goals).

The project, which is co-financed bythe Saudi Fund for Development, OPEC, Islamic Development Bank, and the Kuwait Fund for Arab Economic Development,is expected to have a significant impact on Pakistan’s energy and water sectors. By using renewable energy sources, the project will generate 800 MW of electricity production capacity, contributing to Pakistan’s energy security. In addition, the storage of 1.6 million m3 of water will support sustainable agricultural practices, enable irrigation of 6,773 hectares of new land, and increase the total cropping area from 1,517 hectares to 9,227 hectares in the province, facilitating agricultural activities.

During the agreement signing ceremony, the CEO of SFD emphasized the strong developmentalties between the Kingdom of Saudi Arabia and the Islamic Republic of Pakistan. The CEO also highlighted the significance of joint cooperation between development funds, as evidenced by this project. He further emphasized that this initiative is an extension of SFD’s continued support for development projects and programs in Pakistan since its inception. To date, SFD has financed around 41 development projects and programs in Pakistan, amounting to approximately $1.4 billion, In addition SFD has financed between 2019 and 2023, oil derivatives worth more than USD 5.4 billion, to support Pakistan’s economy, this comes as a continuation of the support provided by the Government of Saudi Arabia to the brotherly country Pakistan to build a sustainable economy.

For his part, Dr. Kazim Niaz expressed his sincere appreciation and gratitude to the Kingdom of Saudi Arabia for its unwavering support towards the development sectors in Pakistan through the SFD. He recognized the significant contribution made by the Kingdom towards financing the vital project and emphasized its importance in bringing about positive developmental impacts on Pakistan and its people. The use of renewable energy would enable sustainable energy as well as water sources, which would enhance water and food security. Dr. Niaz praised the Kingdom of Saudi Arabia’s development efforts through SFD since 1976, which have led to remarkable social growth and sustainable economic prosperity.

The SFD has also supported 76 development projects and programs in the energy sector in African and Asian countries since 1975, including 33 projects and programs in African countries, 42 projects and programs in Asian countries, and one project in Latin America. Additionally, the SFD has played an active role in supporting and developing renewable energy sector projects, which amounted to 35 projects in 23 developing countries worldwide.

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