SLAMABAD (April 12 2010): The United States government lifted the ban on the release of funds for development projects in Pakistan, to be financed under USAID umbrella, last month, Business Recorder has learnt. "After lifting of the ban, Pakistan is expecting release of $15 million in project mode in the current month-money that was withheld due to the ban", sources said.

To cope with energy crisis in the country, the government is currently seeking assistance under USAID programme amounting to $1.6 billion during 2010-13. Pakistan has sought $105 million assistance for three ongoing energy projects during the current financial year 2009-10. These are Kachhi canal (Balochistan), Gomal Zam Dam (South Waziristan) and Satpara dam (Gilgit-Baltistan).

The government has requested for $700 million assistance under USAID programme for five new projects during coming financial year 2010-11. These projects are Diamer Basha Dam (NWFP/Gilgit-Baltistan), Kurram Tangi Dam (North Waziristan), Tank Zam Dam (NWFP), Upgradation (E&M) of Mangla Hydel Power Station (AJK) and Upgradation (E&M) of Warsak Hydel Power Station (NWFP).

Among these projects, 4500 MW Diamer Basha Dam is a mega project and its original cost estimate of $8.5 billion in 2005 has escalated to $15 billion due to depreciation of Pakistan's currency against dollar. "Pakistan has requested for $300 million financing for this project during the next financial year 2010-11 under USAID assistance programme," sources maintained.

The federal government and affectees of Diamer Basha dam have recently reached an 'out of court' settlement under which government will provide Rs 40 billion compensation. According to initial estimates, 29000 to 30,000 families living in 31 villages will be affected due to construction of this dam. Under the plan, government will build nine model villages for the affectees.