ISLAMABAD, October 29, 2026 — The World Bank has expressed concern over progress on a $727 million hydropower and renewable-energy project in Khyber Pakhtunkhwa, warning that significant risks remain despite improvements in implementation.
The bank rated progress towards the project’s development objectives as “moderately unsatisfactory”, while assigning a “moderately satisfactory” assessment to overall implementation.
The Khyber Pakhtunkhwa Hydropower and Renewable Energy Development Project was approved in 2020 to expand electricity generation from renewable sources and strengthen provincial energy institutions. Its scheduled closing date is November 30, 2027.
A major component is the 88-megawatt Gabral-Kalam hydropower scheme in Swat, designed to generate approximately 339 gigawatt-hours of electricity annually.
According to the World Bank’s latest assessment, civil works have begun at Gabral-Kalam, land acquisition has advanced and procurement of electromechanical equipment is progressing.
However, financial disbursements remain limited across important parts of the financing package, highlighting the challenges facing the project.
The bank identified substantial risks involving institutional capacity, financial management, economic conditions, and environmental and social safeguards.
The project has also undergone restructuring to align its scope and funding with revised implementation priorities.
Earlier security-related travel restrictions prevented a World Bank mission from visiting certain project locations, complicating its assessment of proposed investments.
For Khyber Pakhtunkhwa, the project’s eventual completion could provide additional renewable electricity and support longer-term development of the province’s hydropower resources.
The latest findings underline the importance of completing construction, strengthening project management and meeting environmental requirements before the remaining implementation deadline.