ISLAMABAD, May 1: The government on Wednesday approved in principle an increase of Rs334 million in the project cost of Rs1 billion Naltar Hydropower project in the Northern Areas.

The cost of the project would now be Rs1.339 billion, mainly because of change in the design and reported fluctuation in the dollar parity.

A decision to this effect was taken here at a meeting presided over by Minister for Kashmir Affairs & Northern Areas and Water and Power Aftab Ahmad Khan Sherpao.

The 18-mw hydropower project would take 37 months to complete. According to original PC-I, cost of the project was Rs1 billion. However, due to some design changes as suggested by Wapda, the revised cost comes at Rs1.339 billion.

The CLIC of China would construct the project on a turn-key basis for $19.188 million. Wapda, on the recommendations of consultants, has suggested 3.9 kilometre RCC power channel with 1.8 kilometre covering slabs, whereas the CLIC had suggested 2.5 km open power channel in stone masonry.

The change in power channel design would incur an additional cost of Rs69.6 million. Additional cost in revised PC-I would stand at Rs335 million, which included Rs146.982 million as dollar rate parity and Rs188.365 million for additional items.

Additional items include RCC power channel, land compensation, consultancy, work charges staff, contingency, offices/residential accommodation and feeder line. Feeder line for Nomal and Naltar costing Rs6.3 million would facilitate electricity for the surrounding villages.

The minister directed that ground-breaking ceremony of the project should be arranged as soon as possible because the president was taking keen interest in the project.

The minister said that the president was committed to this project as its commissioning would bring a remarkable improvement in power shortfall in the Northern Areas, particularly the Gilgit District.

Mr Sherpao directed that the work on the project may be initiated under the old PC-I. However, the revised PC-I should be submitted for the approval of ECNEC.