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The Japan Bank for International Cooperation (JBIC) has signed two loan agreements totaling ¥16.362bn (US$150mn) with the government of Pakistan for the Lower Chenab canal system rehabilitation project and a load dispatch system upgrade project.
Since Pakistan conducted a nuclear test in 1998, ODA loans to Pakistan have been suspended. However, after an official visit made earlier this year by Prime Minister Koizumi to Pakistan, Japan indicated that it would resume ODA loans to the country due to the vital role Pakistan has played in the fight against terrorism.
The ODA loan also supports a stable power supply, which is an essential component for economic growth. The National Power Control Centre which is responsible for controlling the power supply for Pakistan (excluding Karachi) will be modernised, ensuring a stable power grid system in Pakistan.