The Cost of Pakistan’s Dam Obsession

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The Cost of Pakistan’s Dam Obsession

Dams may seem to be a perfect solution to Pakistan’s water woes, but they carry steep costs – literally and figuratively.

The Cost of Pakistan’s Dam Obsession

In this photo taken on Nov. 18, 2005, Pakistan’s biggest Tarbela Dam is observed from a helicopter in Tarbela, Pakistan.

Credit: AP Photo/Anjum Naveed, File

In August 2018, seated behind a large desk and looking straight into the camera for his inaugural address, Prime Minister Imran Khan declared that building dams was the only way to tackle Pakistan’s existential water problems.

Fast forward a few years and the Water and Power Development Authority (WAPDA) has started construction on two major hydroelectric projects: Mohmand in Khyber Pakhtunkhwa and Diamer-Bhasha in Gilgit-Baltistan. The latter, a 272-meter behemoth, is billed as the highest roller compacted dam in the world. With a storage capacity of 8.1 million-acre-feet, it’s also touted as a silver bullet for Pakistan’s water crisis.

On the face of it, dams seem to make imminent sense for Pakistan, where a water-intensive agricultural sector employs nearly half the workforce. With reports warning that the country could “run dry” by 2025, an increase in storage capacity should, in theory, increase the availability of freshwater during droughts.

But experts disagree.

“Nobody can deny this will increase storage,” said Daanish Mustafa, a professor of critical geography at King’s College London. “But surface storage is the most inefficient kind and these dams don’t increase year-on-year storage; they increase seasonal storage.”

Pakistan’s two largest dams – Tarbela and Mangla – are seasonal regulators, explained Mustafa. They are filled during the monsoon season and drained during the dry winter months for crop production. This means that while Diamer-Bhasha may increase storage capacity in the Indus Basin seasonally, it won’t create a perennial reserve of water to draw on during lean years.

Then there is the price tag to consider. Pakistan has struggled to secure funds for the Diamer-Bhasha dam for years. The project was initially green-lit by President Pervez Musharraf’s government in 2006, but both the World Bank and Asian Development Bank refused to finance it, citing the dam’s location in disputed Kashmir. A well-intentioned attempt to crowdfund the dam in 2018 by the Supreme Court also failed to raise enough money. Finally, in May 2020, China stepped in to bankroll part of the project.

But even at $14 billion, the estimated cost for Diamer-Bhasha might be too low. For instance, an Oxford University study of 245 dams built in the past century found that most budgets underestimated total expenditure by around 99 percent. With inflation, debt servicing, and environmental externalities priced in, a dam could end up requiring twice its initial financial commitment with little chance of a return on investment. This means that even if Diamer-Bhasha is completed within the proposed nine year timeframe, it will likely cost around 10 percent of Pakistan’s current GDP.

A Nationalistic Project

Dam advertisements on WAPDA’s official website tend to ignore these nuances, perhaps because of the federal government’s full-throated endorsement of Diamer-Bhasha and other hydroelectric projects. For Khan in particular, a renewed commitment to massive infrastructure projects is a turn away from what the prime minister recently described as a “decade of darkness,” in which political parties “thought of their elections instead of making dams.” Khan made these comments at a screening ceremony for “Pani ke Pankh” (Water’s Wings), a 30-minute, borderline propagandist “docu-drama” explaining how Pakistan first beat back terrorism and is now building dams. (A condensed version of the speech, including snippets from the ceremony, can be found on WAPDA’s “Special Initiative and Social Responsibility Cell” YouTube channel.)

Domestic support for hydroelectric projects is further bolstered by India’s resistance to dam construction in Pakistan. As media outlets across the border criticize the “China-funded Diamer-Bhasha dam,” pro-government Pakistani journalists label dam skeptics unpatriotic – or worse, foreign agents.

For Mustafa, the professor from King’s College, the purpose behind Diamer-Bhasha is clear: “It’s a totally nationalist project.”

Invisible Groundwater

Rooted as it is in jingoistic overtones of progress and independence, growing support for dams is reducing Pakistan’s water challenges to a matter of scarcity and masking what experts see as the more immediate problem of inefficient management – particularly in the agricultural sector, which accounts for 90 percent of water use.

For instance, the Indus Basin sits on a massive aquifer that is rapidly being depleted. This is because groundwater abstraction has been increasing in Pakistan since the 1960s. According to a 2021 World Bank report, the number of reported tube-wells increased from around 98,000 in 1970 to over 1.3 million in 2017. With underground water reserves accounting for up to 80 percent of crop production, the report estimates that groundwater is being pumped at a higher rate than can be naturally replenished through rain or seepage.

Despite this, the Indus aquifer is not factored into Pakistan’s existing water use laws.

For Erum Sattar, an expert on water federalism, this quirk can be traced back to an arcane, colonial-era law known as the Canal and Drainage Act of 1873, which still determines water rights in Pakistan: “The idea was to take available water and spread it as thinly as possible, as widely as possible.” The goal, explained Sattar, was to ensure that small farmers could feed themselves and earn a subsistence income, not become rich or efficient. All that changed in the 1970s, when farmers began to use tube wells to increase their yields.

But distribution rights have not been updated to reflect conjunctive use, thus divorcing them from how water is currently sourced in the Indus Basin. For Sattar, the system creates a “free for all” when it comes to groundwater abstraction, as anyone with access to a tube well or a modest diesel generator can begin extracting without limit.

These problems are compounded by both colonial and post-colonial laws that distribute water on a provincial rather than federal basis. “Both irrigation and agriculture, which are the main users of water, are basically provincial subjects,” said Sattar. “That’s the way the British always set it up.” This method of allocating water provincially was further developed by the establishment of the Indus River System Authority in 1993 with the goal of fixing water quotas for each of Pakistan’s four provinces. “The system, the laws, the rules, the irrigation department, how it operates, is all because of those old frameworks.”

But the old frameworks end up favoring upper riparian regions at the expense of cultivated lands downstream because they don’t recognize that, unlike the lower Indus, Punjab just happens to sit on a natural aquifer, explained Sattar.

“We’re taking a 19th century machine and wondering if it’s working for our 21st century goals. And it’s not,” said Sattar.

Beyond water rights, surface water distribution, too, is inefficient. A 2019 World Bank report identifies “warabandi,” a farm level water distribution method, as a contributing factor. The system works by providing water to farmers for specific durations, determined by the size of the land holding. But, with different rates of flow across the Indus Basin, some farmers receive more water for the same irrigated area than others. Agha Ali Akram, an assistant professor of economics at Pakistan’s LUMS University, argues that this engenders a lack of allocative efficiency in the canal system – a situation in which all farms don’t derive the same net benefit from an additional unit of water.

A concurrent problem for Akram is that water cannot be effectively traded based on farmers’ needs. “Ideally we should have a system where there is some exchange, where some guy upstream says, ‘I don’t need my turn at 1 p.m., does somebody want to buy it?’”

Hidden Costs

Pakistan ranks an abysmal 88th out of 107 countries on the 2020 Global Hunger Index. Additionally, an estimated 26 million Pakistanis are food insecure based on the 2020 State of Food Security and Nutrition in the World report.

These figures are likely to worsen as a direct consequence of water use in the agricultural sector. An overreliance on unregulated groundwater abstraction is already causing problems like waterlogging and land salination. “Our environmental balance is something we have, in a way, totally destabilized. Certainly, we’re killing vast amounts of land we could be planting,” said Sattar.

Groundwater irrigation is also encouraging intensive farming, a major cause of soil infertility. According to Daanish Mustafa from King’s College, the Canal and Drainage Act makes it possible to farm 63 percent of the land in a given year – but only when considering surface water rights. With an unregulated groundwater source available, Mustafa estimates that this figure is well over 100 percent, with multiple crops being planted throughout the year.

What’s clear is that without an overhaul of the legal framework and farm level practices, dams like Diamer-Bhasha won’t address Pakistan’s food insecurity problems. Instead, they might directly exacerbate them by entrenching unequal water rights. The upper Indus region already benefits from a vast network of link canals and dams, including Tarbela, which redirect river water southeast as it flows southwest toward the arid provinces of Sindh and Balochistan. Simply increasing seasonal storage could end up sending more water to grow export crops in Punjab at the expense of food productions in drought-stricken Sindh and Balochistan downstream, where 3.1 million people faced acute insecurity between 2017 and 2018.

According to its Agricultural Department, Punjab between 2011 and 2012 accounted for 83 percent of Pakistan’s cotton, 63 percent of sugarcane, and 97 percent of aromatic rice – all major export crops. Additionally, as data from the Ministry of Food Security shows, Punjab devoted a combined 4,751,000 hectares to these crops during the 2017-2018 fiscal year.

“Dams are a Punjabi obsession,” speculated Mustafa. “That water is going to sugarcane, rice, and cotton.”

Despite government support, the fate of projects like Diamer-Bhasha and Mohmand still hangs in the balance. Dams have always been difficult to build in Pakistan given the riparian conflict they engender. But whether or not they are completed, a renewed emphasis on hydroelectric projects in Pakistan – even if just posturing – will continue to elide the question of how a country with enough farmland and water to feed itself is increasingly doing just the opposite.

Usmaan Farooqui is a researcher and journalist based in the United States. He holds a Ph.D. in political science from the University of Massachusetts-Amherst. He writes on various public interest issues and tweets @FarooquiUsmaan