PACRA Maintains AAA Rating for WAPDA Dasu Sukuk-D

Lahore: The Pakistan Credit Rating Agency Limited (PACRA) has upheld the AAA rating for the WAPDA Dasu Sukuk-D, reflecting the strategic importance of The Pakistan Water and Power Development Authority (WAPDA) as the primary entity responsible for advancing Pakistan’s water and hydropower resources. The rating, which remains stable, underscores the government’s financial backing and favorable tariff schemes that support WAPDA’s operations.

According to Pakistan Credit Rating Agency Limited, WAPDA’s projects, including the Dasu Hydropower Project, receive substantial funding from the Government of Pakistan through grants and loans. The Dasu Project, situated on the Indus River in Dasu Kohistan, Khyber Pakhtunkhwa, is poised to become the country’s second-largest hydropower facility. Launched in 2017 with an expected completion date in May 2027, the project is being developed in two stages to collectively generate 21,485 GWh annually.

In September 2023, WAPDA issued the fourth tranche of its Sukuk, valued at PKR 15,000 million, to finance Stage-I of the Dasu Project. Stage-I, which has achieved approximately 22.36% physical progress and 63.78% financial progress, includes significant milestones such as the completion of the upstream starter dam, project colony Phase-A, and the excavation of a switchyard.

The Dasu Project’s funding strategy relies heavily on borrowing, with 85% of its financing coming from local and foreign long-term sources, as well as bonds issuance, both Islamic and conventional. The AAA rating of the Sukuk is supported by an irrevocable guarantee from the Government of Pakistan, which ensures the payment of the Sukuk’s outstanding amount and profit component.

With robust government support and WAPDA’s strategic role, the agency’s full ownership and control are expected to remain with the government in the foreseeable future.

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