500 Million Dollar is a huge sum !!
Helping hand: Russia pledges $1 billion for steel and electricity
Production capacity of PSM is expected to increase from 1.1 million tons to 1.5 million tons per annum. PHOTO: EXPRESS/FILE
ISLAMABAD: Russia has announced a grant of $500 million for reviving the financially troubled Pakistan Steel Mills and also shown willingness to finance $500 million for a 1,000 megawatt regional electricity transmission project.
Federal Secretary for Industries and Production Javed Awan told
Express News that the announcement for the mill – which was established by the Russians 30 years ago in Karachi – was made when Prime Minister Yousaf Raza Gilani met with his Russian counterpart Vladimir Putin on the sidelines of the 10th heads of government meeting of the Shanghai Cooperation Organisation (SCO), a regional security grouping.
The two premiers, on the sidelines of the summit, also expressed willingness to speed up work on the proposed
Free Trade Agreement and currency swap deal to boost bilateral trade and further strengthen economic ties.
Gilani in his fourth meeting with Putin had a frank and detailed discussion on relations between the two countries in a cordial atmosphere.
Russian Prime Minister Putin said relations between Pakistan and Russia have reached a level, where both the countries were in a position to enhance trade and strengthen ties.
Moreover, Gilani said that Russia was an important country and a source of stability in the region because of its geographical proximity.
The projects
The money earmarked for Pakistan Steel Mills will be spent on repair of machinery and expansion of the steel mill. As a result, its production capacity is expected to increase from 1.1 million tons to 1.5 million tons per annum.
Earlier, Putin had offered Russia’s assistance for enhancing the mill’s production capacity from one million tons to three million tons.
Putin also announced willingness to help finance $500 million for the CASA-1000, a project that envisions building a 1,000-megawatt transmission line from hydropower generators in Kyrgyzstan and Tajikistan to Afghanistan and Pakistan, which are seeking more reliable and cheaper sources of electricity.
The initial agreements call for Tajikistan and Kyrgyzstan to supply an equal amount of electricity to Pakistan, which will receive 70-75 percent of the flow, and to Afghanistan, which will receive 20-25 percent, analysts from the Central Asia-Caucasus Institute told the United Press International.
At about 1,000 miles it would be the biggest regional power supply project in Eurasia, according to United Press International. Nearly 90 percent of its estimated $2 billion cost is to be funded by international finance organizations such as the World Bank and the Islamic Development Bank, with the remaining 10 percent provided by private investors, adds United Press International.
He also offered coal gasification technology for Thar coal reserves and upgrading of Guddu and Muzaffargarh power plants to increase electricity generation to help meet the country’s growing energy needs.
Gilani appreciated Russia’s support for mega projects including CASA-1000.
Prime Minister Gilani called for opening of respective bank branches in both countries to boost trade levels. He said the top officials of their central banks can meet to work on an operational strategy in this regard.
The Russian premier said the inter-ministerial commission’s meeting will be held on December 12, which will take up all subjects of cooperation.
The leasing of Sukhoi commercial aircraft for Pakistan International Airlines was also discussed during the meeting. Putin accepted Gilani’s invitation to visit Pakistan for which dates would be worked out by the respective foreign ministries of the two countries.
