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Dispute with Italian firm over Ghazi Brotha project: Pakistan challenges ICSID's jurisdiction

ISLAMABAD (March 02 2003) : Pakistan has challenged the jurisdiction of International Centre for Settlement of Investment Disputes (ICSID), Washington, in a dispute between Wapda and Italian firm, Impreglio, constructing the Ghazi Brotha hydropower project (GBHP), sources told Business Recorder here on Saturday.

“We have submitted our reply to ICSID, challenging not only the jurisdiction of the international body, but also grounds on which the Italian firm dragged Wapda and the government into a dispute,” sources said.

Riaz Ahmad Khan, Additional Secretary, Water and Power, who is currently on a visit to Washington, handed over the reply to the ICISD Vice Chairman a day earlier, sources added.

The firm, sources said, has claimed $ 450 million from Wapda, which the latter was not ready to pay at any cost.

Pakistan, sources said, in its reply has mentioned three points, saying that Impreglio did not make any investment in the multibillion dollars project.

The firm had pleaded that its investment in the project was in risk.

Sources said that Pakistan has also proved that the contract was signed between Impreglio and Ghazi Brotha contractors (GBC), a consortium of contractors comprising three local firms, rather than Wapda or the government of Pakistan. But the firm did not make them party in the dispute.

The third point, sources said, Pakistan raised was that ICISD could not hear this case, as it does not fall under the purview of this forum.

Pakistan has cleared that the firm could only approach the Dispute Settlement Board (DSB), which is a proper body to hear disputes.

The Italian firm had stopped work on the Ghazi Brotha Hydropower Project after 9/11 incident in the United States and refused to resume construction on the on the pretext of law and order situation.

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