ISLAMABAD, June 10: France has agreed to provide a soft-term loan of Rs913 million to Pakistan for improving and extending the existing sewage treatment plant located in Sector I-9, a source in the Economic Affairs Division (EAD) told Dawn on Monday.

The source said the EAD had directed the Capital Development Authority (CDA), through a letter, to execute the long-awaited project.

The project includes construction of the fourth phase of the plant, improvement and refurbishment of the first two phases and repair of the third one.

The cost of the entire project is Rs1,296.274 million. Out of this amount, Rs913.3 million (130 French Francs) will be provided by the French government, the source added.

The CDA officials appreciated the Economic Affairs Division for accepting the French government’s offer, which it had rejected last year.

A French delegation had visited Pakistan last year to finalize the deal of executing the project of the sewage treatment plant’s fourth phase. But, the deal could not be finalized because the EAD wanted the amount as grant-in-aid instead of loan.

“Though the government of Pakistan desired the commissioning of the project immediately, it refused to accept the loan from the French government”, a CDA official said.

He said the French delegation had also received a similar response from the CDA in a meeting held with the authority’s senior officials.

He said the project would be commissioned as soon as the amount of loan was released by the French government.

The fourth phase of the sewage treatment plant is stated to be in doldrums and the existing three phases are not yielding the desired results because faults had developed in them which had affected the plan’s output.

The source said the project of the sewage treatment plant was approved by the Executive Committee of the National Economic Council (Ecnec) in 1994. But, due to the long delay, the cost of the project had increased.

The estimated cost of the project has been revised to Rs1,296.274 million which was Rs1,217.159 million in 1994, including foreign soft-term loan of Rs913.3 million. However, the required amount of foreign loan has also increased to Rs968.777 million.

The total production of sewage water in Islamabad is about 23 million gallons per day (MGD), which after passing through Islamabad and the thickly populated areas of Rawalpindi falls into Soan River.

This sewage water is stated to be one of the major source of environmental pollution in the twin cities as well as Soan River.

If the fourth phase of the existing sewage treatment plant is completed, some 20 MGD of sewage water will become usable for irrigation and industrial purposes.

The source said there were two other firms, one from the UK and another from Switzerland, that had shown interest in executing the project, but after Pakistan conducted nuclear tests in 1998, both countries refused to commission it.