THE government has finally closed the deal for the construction of the Diamer-Bhasha dam.

The Rs442bn contract has been awarded to a joint venture comprising China Power and the Frontier Works Organisation.

The world’s tallest roller compact concrete dam is but a part of a multipurpose Rs1.4tr hydropower enterprise that will be funded through public-sector development and commercial loans.

The 4,500MW power station will be built later.

That the contract for the dam construction has been awarded nearly 40 years after the project was originally conceived, 16 years after its feasibility was completed, 12 after its design was finalised and almost 10 years after it was approved by the CCI speaks volumes for the financial difficulties and political issues in implementing a large water development scheme.

In between, one president and three prime ministers found time to lay its foundation stones between 1998 and 2011.

Recently, work on Diamer-Bhasha was delayed by international lenders’ decision to pull out of the project after India objected to the location of the dam, which straddles Gilgit-Baltistan and KP.

Last year, the government decided to split the project into two major components — the dam project to be constructed with public-sector funds and the power project to be developed in IPP mode — and involve Chinese firms and money to complete it.

The Diamer-Bhasha project is an economically important enterprise as it will create water storage of 8.1MAF for agriculture and generate 81bn units of clean electricity once it is completed in 2028.

It is also billed to save the economy Rs23bn in flood losses annually, bring 1.23m acres of additional land under cultivation, reduce water shortages from 12MAF to 6.1MAF, increase water storage capacity from 30 days to 48 days, and add 35 years to the life of Tarbela by reducing sedimentation.

During its construction, the project is expected to create 16,550 jobs (mostly for the local population), generate a large demand for cement and steel, and stimulate economic growth, which is estimated to contract by up to 1.5pc owing to the pandemic.

The years between 1958 and 1976 were seen as the best period for the development of the water sector and hydropower projects in the country.

Tarbela and Mangla are also from the same period.

It was followed by a largely dry spell until 2007 when the pace of such projects picked up as water shortages became more acute and thermal electricity generation unaffordable and erratic — this in spite of the Water Apportionment Accord of 1991 between the provinces that underlines the need for building more water storages to store floodwaters and overcome growing shortages.

The availability of water for irrigation is declining and weather patterns are getting erratic because of climate change.

The country needs to build large storage capacity to save wastage of water in order to protect food security and the Indus Basin habitat.

Published in Dawn, May 15th, 2020