ISLAMABAD: Prime Minister Imran Khan on Monday launched the country’s first green Eurobond by Water and Power Development Authority to meet the financial needs concerning the construction of the Diamer-Bhasha and Mohmand dam projects.
The bond has been floated for 10 years to raise $500 million at a competitive price of about 7.5 percent interest rate.
The prime minister lauded the WAPDA chief and his team for the landmark achievement of securing bonds in the international market, at the launch ceremony of the bond held at the Prime Minister’s House.
Imran expressed satisfaction over the interest of leading international investors in Eurobond, saying it reflected their confidence in the government and WAPDA.
He lauded the body for the fast pace of construction of dams, which he said was vital to produce clean energy for a green environment and save the coming generations.
The prime minister said that the “decade of dams” project, initiated in 2018 should have been worked up five decades ago to ensure water security.
“Ten dams to be built in next 10 years will produce 10,000-megawatt clean electricity. It is a step of thinking about our next generations,” he emphasised.
He stressed the long-term planning instead of a short-term election-to-election approach to carry out development projects in the country.
He regretted that short-term planning in electricity generation resulted in the commodity’s highest per unit rate compared with the rest of the countries in South Asia.
Imran said that clean energy production supplemented by the 10 billion trees project would help overcome the impact of climate change and also the rising levels of pollution in big cities.
The establishment of 15 new national parks, recharging of wetlands and growing the dense mangroves are the government’s effective steps to counter global warming, he added.
The prime minister touched upon other areas where the government was focusing to bring about a change including uniform academic syllabus, health card scheme, controlling mother and child mortality rate, and reforms for promotion of agriculture and livestock.
Finance Minister Shaukat Tareen said that the success in securing the interest of international companies in Wapda’s bond showed the confidence of the international community in the leadership of Prime Minister Imran.
He said that completion of the dams was critical for meeting the country’s water requirements, adding that the launch of the bond would help increase the funding for water reservoirs.
WAPDA Chairman Muzammil Hussain said that the launch was a major achievement wherein a parastatal organisation the international bond market on its own credentials without any financial obligation on the government.
He mentioned that top investment banking company JPMorgan Chase expressed interest in a project in Pakistan after 25 years, and added that the bond enhanced the country’s economic profile.
The bank’s vice chairman, Mark Stephen Garvin, in a video message congratulated Pakistan on the launch of the bond and lauded WAPDA’s “unwavering commitment despite challenges”.
According to a report by the body, the Regulation S bond has been launched at a very competitive price of 7.5 percent, which is unprecedented given Pakistan’s sovereign bond maturing in 2031 has a coupon of 7.375 percent.
“This will go a long way in diversifying the funding sources for undertaking huge capital-intensive projects,” reads the report.
The report states that there was a tremendous appetite for WAPDA’s Indus bond with the order book oversubscribed six times reaching close to $3 billion. This included credible and top companies, including Goldman Sachs, Blackrock, Bluebay, Fidelity, Ashmore, Amundi and UBS.
“It is a gold-plated transaction and Wapda appointed top [international] banks led by JP Morgan, who have come back to Pakistan after a hiatus. The co-book runners included Deutsche and Standard Chartered with HBL as co-Manager,” the report said.
