ISLAMABAD, Jan 18: The World Bank on Wednesday indicated its readiness to finance Bhasha and other viable dams but called for implementation of water accord and replacement of prevailing royalty payment patterns to provinces.

Speaking at a news conference, country representative of the World Bank John W. Wall, however, said the geological and technical studies of the Bhasha dam were not available and the bank had not yet analyzed its economic rate of return. However, he said, it was presumed that it would be a good investment.

He also formally released a report “Pakistan: Country Water Resource Assistance Strategy, Water Economy: Running Dry”, which has extensively been published in the press a couple of months ago. The bank will conduct the appraisal of the project, examine its economic rate of return and ensure that environmental and displacement concerns were mitigated.

He termed Bhasha dam’s cost estimate at $6.5 billion very old and said it was based on calculations made before the completion of its feasibility study. Similarly, he said the cost estimate of Kalabagh dam at $6 billion was also very old.

In his opinion, Pakistan will have to announce a National Settlement Policy for the resettlement and compensation for people to be displaced by the construction of new dams to qualify for the World Bank financing.

He said major investments in irrigation would remain a major challenge because of fiscal responsibility law that puts a maximum on the amount of public debt the government could borrow.

He said the economy was booming but the government’s abilities to mobilize tax revenue to pay for public goods remained low and there were many priorities for development in addition to water sector.

He said Pakistan needed to appoint a neutral water auditor.