World Bank disputes KP government over hydropower project

The ongoing dispute between the Khyber Pakhtunkhwa government and the World Bank regarding the Gabral Kalam hydropower project has intensified. The PTI administration has decided to cancel the bidding process for the 88 MW project and initiate a fresh round of bidding. The World Bank has raised concerns that not awarding the contract to the lowest bidder could lead to misprocurement issues, potentially jeopardizing a $450 million loan. Moreover, there is a possibility of downgrading the project rating from moderately satisfactory to moderately unsatisfactory.

Additional Chief Secretary Imtiaz Hussain Shah disclosed that complications arose in the bidding process, initially approved by the World Bank, when the second-lowest bidder raised objections. Despite the World Bank giving a no objection letter for contract award, discrepancies emerged regarding the lowest bidder's eligibility criteria and project cost estimates.

During a policy board meeting of PEDO chaired by the chief minister, it was revealed that the lowest bidder did not meet the required eligibility standards, such as construction experience and accurate project cost estimation. The project director clarified that the bid submission error led to the incorrect indication of the project cost as $124 million instead of the actual Rs2 billion.

Following the board's suggestion to cancel the current bidding process and seek guidance from the World Bank, a meeting was held with World Bank officials. However, the bank expressed dissatisfaction with the decision, citing project implementation delays and performance issues. The World Bank emphasized concerns about the project's advancement and cautioned about potential loan cancellation if the contract award process was not expedited.

The World Bank's reservations highlight doubts about the KP government's capability to efficiently execute projects funded by international bodies. The misprocurement challenges raise questions about PEDO's effectiveness and the government's competence in avoiding penalties linked to project delays. This situation necessitates a reevaluation of project implementation strategies to ensure the timely and successful completion of such large-scale endeavors.

The clash between the Khyber Pakhtunkhwa government and the World Bank over the Gabral Kalam hydropower project underscores the importance of transparent and efficient project management. Addressing the concerns raised by the World Bank is crucial to maintaining the integrity of international partnerships and ensuring the successful execution of development projects. Moving forward, a collaborative effort between the government and international organizations is essential to overcome challenges and deliver impactful initiatives for the benefit of the region.