India clears cost hike for Afghan power project

Last Updated: Thu, Jun 10, 2010 13:50 hrs

Signalling its resolve to stay engaged in Afghanistan, the government Thursday approved revised estimates for a hydro-power project in Herat province that has made it costlier by around $12 million.

In its first phase till December 2010, the Salma Dam project will now cost over Rs.800 crore (around $180 million).

The approval was given in a cabinet meeting chaired by Prime Minister Manmohan Singh, Information and Broadcasting Minister Ambika Soni told reporters, adding that the cost escalation for the Salma Dam project till December 2010 will be over Rs.54 crore (around $12 million).

The approval of the revised costs comes against the backdrop of speculation about pressure on India to scale down its presence in Afghanistan and underlines its resolve to continue with its reconstruction of the war-ravaged country in the face of threats from the Taliban.

India has pledged $1.3 billion for a slew of reconstruction projects in the violence-torn Afghanistan, ranging from the building of roads and dams to power plants and grassroot development projects.

The Salma power project is being executed in the Herat province of Afghanistan by the Water and Power Consultancy Services (India) Limited (WAPCOS) and is being funded by the Indian government under a scheme for reconstruction of the war-ravaged country.

The successful completion of the project will lead to overall development of Afghanistan's western regions and generate goodwill for India in Afghanistan, said Soni.

'The project will also showcase Indian engineering and enhance India's role as a major regional player,' she said.

About 50 percent of the project's components related to construction work, manufacturing of hydro mechanical and electro mechanical work, transmission work and infrastructure work have been completed.



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