South Asia’s Most Costly Dam Gets an Infusion

by Ann-Kathrin Schneider
Monday, December 15, 2008

Pakistan's National Economic Council has approved US$1.5 billion toward the construction of the 4,500 MW Diamer-Bhasha Dam on the Indus in the North of the country. With this decision, the government gives the go-ahead for a project with a 200-square-kilometer  reservoir and a price tag of $12.6 billion. The $1.5 billion is earmarked just for the acquisition of land.

According to Raja Pervez Ashraf, federal minister for water and power, Chinese companies are interested in constructing the project and "some Arab countries" want to form a consortium to help Pakistan build the project. Pakistan has already signed a memorandum of understanding with the China International Water and Electricity Corporation for the construction of Diamer-Bhasha Dam, however, no international financier has officially associated themselves with the most costly project currently planned in South Asia.

In August 2008, a fact finding team of four water activists from Pakistan visited six villages near the dam site near Chilas, the regional capital on the border of Pakistan's Northwestern Frontier Province and Northern Areas, to assess the situation on the ground.

What they found was widespread fear among the local people that the project would eat away all fertile land in the area, and that only those paying bribes would be compensated for their losses.

While preparing for the visit, the activists had immense problems accessing information about the planned dam. "Transparency levels are very poor and therefore it is very difficult to get information for educated citizens of the country, and almost impossible for illiterate laymen to access information," they said.

In the villages around the planned dam site, residents complained that nobody had consulted them on a project that would flood their homes and force them to leave their villages. The only officials who had talked to them were there to measure their land to assess compensation levels, they said.

Land matters greatly in this hilly area: steep slopes and bare mountains leave only small tracts of flat land for people to grow maize and wheat and graze their animals. With the reservoir flooding 11,400 hectares, 150 hectares needed for workers' colonies and 200 hectares for the construction workshop and equipment, locals doubt whether enough fertile, flat land would be left for them.

The fact finding team reports: "People think they will be having no land to settle and become mohajareen (People who migrate somewhere)."