USD 18 million from OPEC Fund for Kaluganga development project

The Kaluganga development project is currently being implemented by the Ministry of Mahaweli Development and Environment with the financial assistance of Saudi Fund for Development (SFD), Kuwait Fund for Arab Economic Development (KFAED) and OPEC Fund for International Development (OFID).

The Kaluganga Reservoir has a capacity of 265 million cubic meters (MCM) of water and will divert 100 MCM annually to Moragahakanda Reservoir. Under this project, it is expected to develop new irrigable lands of nearly 3,000 ha in the Kaluganga Basin.

Unforeseen geological conditions in the foundations and necessary design revisions have led to a price increase and it is noted that the funds available from the donors is not sufficient to complete the balance work of the project.

As a result OFID has agreed to provide an additional loan of USD 18 million to finance a part of the shortfall.

The Government of Sri Lanka has already entered into an agreement with KFAED to finance a part of the balance of the shortfall. The balance part of the shortfall is to be obtained from SFD.

Accordingly, the Loan Agreement was signed at the office of OFID in Washington DC by Dr. R.H.S. Samaratunge, Secretary to the Ministry of Finance and Mass Media on behalf of the Government of Sri Lanka and Suleiman J. Al-Herbish Director General of OFID on behalf of the OPEC Fund for International Development.

Minister of Finance and Mass Media, Mangala Samaraweera was also present at this occasion. (Colombo Gazette)

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