LAHORE, May 26: The Kalabagh dam project has been shelved for good and the government is diverting allocations made for the plan to other projects in the water sector.

Federal Minister for Water and Power Raja Pervaiz Ashraf said at a press conference here on Monday that the project was ‘impractical’ because three provincial assemblies had passed resolutions against it and the PPP, being a federal party, could not undertake a plan which negated the principles of federalism. “A dam cannot, and should not, be built at the cost of the federation.”

When the government could come up with alternative projects, “why insist on a dam which threatens the federal basis of the country,” he said.

He said funds allocated for Kalabagh dam would be diverted to other water projects.

The minister announced that the government had prepared a strategy to rid the country of loadshedding by the end of 2009. He said that power generation capacity would be increased by 2,200 megawatts.

He said 1,000MW would be generated by independent power producers (IPPs) and tenders had been floated for the purpose. He said 200MW would come from rental power and another 1,000MW from enhancement of the capacity of the generation system and improvement of oil supply to the IPPs.

Mr Ashraf said the water situation was improving and an additional 500MW would start coming from hydroelectric sources. “All put together, the country will be out of the woods by the end of next year.”

Replying to a question about Pakistan Electric Power Company’s estimate that the country would be needing around 6,000MW in the next three years, the minister said there were more projects in the pipeline which would further ameliorate the situation.

He said Pepco was holding negotiations with industries for purchasing power generated by them and 300MW to 400MW could be added to the system from the source.

He reiterated the government’s resolve to carry out stringent power conservation measures. He said all shops would close by 9pm, which in fact would be 8pm because clocks would be advanced by one hour from June 1.

When asked whether pulling the shutters down by 9pm was a federal decree or just a suggestion, Mr Ashraf said it was a “federal decision taken in consultation with the provincial governments”.

He said the industries were being requested to stagger their off days over the week, rather than the entire sector closing on Sundays. He said Pepco would stop supplying power to neon signs and only alternate streetlights would be used.

The minister said the conservation measures were only for 90 days and the situation would change after Aug 31.

He said Rs120 billion had been allocated for the water sector and its projects had been put on the fast track.

The Mangla dam raising project would be completed and tender for Diamer-Basha dam would be floated next year, he said.