The Asian Infrastructure Investment Bank (AIIB) on January 16, 2023 approved allocation of 5 million U.S. dollars in grant to the Government of Tajikistan.
The AIIB notes that this Project Preparation Special Fund (PPSF) grant will support strengthening the Roghun Hydropower Development Project (RHDP)’s financial and commercial frameworks, enhancing its
According to the AIIB, the Roghun hydropower plant on the Vakhsh River with an installed capacity of 3,780 MW and an embankment dam of 335 meters in height, making it the tallest dam in the world when completed, would allow the export of clean energy to Central Asian countries and facilitate easier integration of intermittent renewable energy and will contribute to decarbonizing the fossil-fuel-dominated Central Asia power systems.
The grant will be used to support consulting services for the improvement of dam safety and the updating of the Project’s environmental and social safeguards instruments to align them with the international best practice and the requirements of the environmental and social safeguards policies of the multilateral development institutions.
The grant will also finance the advisory services to help the Government of Tajikistan with the financial structuring of the Project and preparation and negotiations of long-term power purchase agreements for the Project. The PPSF-funded activities will be jointly co-financed by the World Bank, according to the AIIB.
The PPSF grant will be implemented by the Projects Management Group of the Power Plant Construction under the President of Tajikistan.
Recall, to complete the construction of the Roghun hydropower plant, Tajikistan founded OJSC NBO Roghun in April 2008 after it formally revoked a contract with Russia's RusAl aluminum company in August 2007. To raise funds to complete construction of the Roghun HPP the government started to sell shares in Roghun to people on January 6, 2010. Tajikistan has reportedly issued 6 billion somonis worth of 5 million Roghun shares.
In 2016, construction duties on Roghun were assigned to Italian company Salini Impregilo (currently Webuild).
The project is broken down into four components, with the most expensive one involving the building of a 335-meter-high clay core rockfill dam — the tallest in the world — which will entail costs of around $1.95 billion. Construction of the Roghun hydropower plant is expected to be completed in 2033.
Two of the six turbines have already started producing energy for sale to raise funding to complete it. The first turbine went into service in November 2018 and the second one was introduced into operation in September 2019.
The Ministry of Finance noted in early August last year that 37.7 billion somonis have been spent for construction of this hydropower plant since 2008.
If built as planned, the Roghun hydropower plant is expected to end chronic power shortages in Tajikistan and allow it to export electricity to neighboring countries.
In his address to a joint meeting of parliament, President Emomali Rahmon said on December 23 last year that the construction activities at the site for construction of the Roghun hydropower plant are ongoing dynamically. To this end TJS3.2 billion (equivalent to 315 million U.S. dollars) were channeled in 2022.
The Asian Infrastructure Investment Bank (AIIB) is a multilateral development bank that aims to improve economic and social outcomes in Asia. It is the world's second largest multi-lateral development institution. The bank currently has 106 members, including 14 prospective members from around the world. The breakdown of the 106 members by continents are as follows: 42 in Asia, 26 in Europe, 21 in Africa, 8 in Oceania, 8 in South America, and 1 in North America.
The Bank was proposed by China in 2013 and the initiative was launched at a ceremony in Beijing in October 2014. The Bank started operation after the agreement entered into force on December 25, 2015, after ratifications were received from 10 member states holding a total number of 50% of the initial subscriptions of the Authorized Capital Stock. The starting capital of the AIIB was US$100 billion, equivalent to 2⁄3 of the capital of the Asian Development Bank and about half that of the World Bank. It received the highest credit ratings from the three biggest rating agencies in the world, and is seen as a potential rival to the World Bank and IMF.
