The Pakistani government has formally requested an extension for the completion of the National Transmission Modernization I project, valued at $425 million and funded by the World Bank. The extension is sought due to delays in finalizing essential procurement and land compensation activities. This request marks the second restructuring of the project, with the initial restructuring occurring in October 2023 to include a withdrawal category in the Financing Agreement, allowing for the capitalization of Commitment Charges (CC) and Interest During Construction (IDC).
Official documents from the World Bank indicate that the government has sought a 35-month extension through a letter, aiming to accommodate the completion of ongoing contracts and Infrastructure Works and Services (IWS) works with an implementation completion time of 30 months. The World Bank management has agreed to process the requested extension in two phases, with an initial extension of 15 months.
The proposed restructuring aims to extend the closing date of the IBRD loan by 15 months until April 30, 2025, to facilitate the completion of ongoing contracts. A second extension for the remaining implementation period will be considered based on the progress of the IWS package and the completion of land compensation payments.
The National Transmission Modernization I Project (NTMP-I), approved in December 2017, supports the expansion and upgrade of Pakistan’s transmission network, deployment of an Enterprise Resource Planning System for the National Transmission & Despatch Company, and provides technical assistance for strengthening NTDC’s planning, operations, and maintenance capability.
Despite the approved loan totaling $425 million, only $79 million has been disbursed to date. The restructuring seeks approval to extend the project’s closing date by 15 months, from January 31, 2024, to April 30, 2025. Implementation progress is currently rated ‘Moderately Unsatisfactory’ due to delays in critical procurement and land compensation activities.
While the overall safeguard and fiduciary ratings are deemed ‘Moderately Satisfactory,’ recent advancements include progress in awarding the Islamabad West Substation package and improvements in project disbursements. The Islamabad West Substation package, the largest under the project, is set to be awarded soon. Additionally, progress is noted in the implementation of all contracts under Component A, focusing on the expansion and upgrade of the transmission network.
Under Component B, the deployment of the Enterprise Resource Planning system shows satisfactory progress, especially in the works on the data center. Component C, focusing on project management, technical assistance, and capacity building, highlights advancements in the comprehensive system study on NTDC’s power system and the development of a detailed capacity-building plan under review by the World Bank.
