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Khalid Mustafa

The News

Published Date: Aug 18, 2011

KISHANGANGA TO CAUSE PAKISTAN RS12B ANNUAL LOSS

If the Kishangaga hydropower project being built by India in held Kashmir gets commissioned by 2014 as per the new schedule, Pakistan will be left to suffer over Rs12.1 billion annual losses ($140 million loss) just in the wake of reduction in hydro generation by Neelum-Jhelum hydropower project. It will also be hit by a Rs421 million loss since the execution of planned agriculture development activities will also be jeopardised, reveals a study carried out by eminent water expert, Arshad H Abbasi of the Sustainable Development Policy Institute (SDPI).

Abbasi in his study asserts that the responsibility of the above losses will lie with the adviser of MoWP and be the result of sheer negligence on his part. Bilateral negotiations on Kishangaga collapsed in April 2010 when India replied to the MoWP that the project was started much earlier than Neelum-Jhelum Hydropower Project (NJHEP). “This stance of India is true,” the study says.

The original PC-1 of the NJHEP with capacity of 500MW was approved by ECNEC in December 1989 for an amount of Rs15 billion only. For detailed feasibility and engineering design, the work was awarded to a Norwegian firm NORCONSULT in 1994. The detailed engineering plan, with enhanced capacity of 969MW and amended design of the project, was completed in 1997 with an estimated cost of Rs94 billion. The stipulated time for completion of the project was six years. The project was kept on the top priority list in the Power Policy 2002, and was scheduled to be completed in 2008. But then Chairman Federal Commission and now Adviser MoWP kept the project on the back burner despite the looming energy crisis.

The contract award of NJHEP was awarded to a Chinese consortium comprising Chinese Gezhouba Group of Companies in 2008, 12 years after the detailed engineering plan. “The abnormal delay in awarding of work shows that criminal professional negligence of the adviser led the case to the International Court of Arbitration. An in-depth investigation is needed to ascertain why this official allowed Indians to start KHEP and then awarded NJHEP,” the study pinpointed.

Pakistan is fighting the legal battle in the Court of Arbitration at The Hague against India on the Kishangaga project and argues that a diversion of the water by India, which is destined to reach the lower riparian country, is a clear violation of the 1960 Indus Waters Treaty. Pakistan’ delegation headed by Kamal Majidullah, Special Assistant to Prime Minister on Water, is also going to seek on August 25 a stay from the Court of Arbitration on the ongoing construction work on the Kishangaga project.

However, Abbasi’s study reveals that the authorities in the Ministry of Water and Power have delayed the construction of Neelum-Jhelum hydropower project by 8 years. The project’s detailed engineering plan with enhanced capacity of 969MW and amended design was completed in 1997, but its contract was awarded to a Chinese company only in 2008. This delay has provided the Indians an upper edge to complete its project first as it has completed 40 percent work on the Kishangaga project.

Pakistan is constructing the 969MW Neelum-Jhelum Hydropower project on the same river on which India is constructing the 330MW Kishangaga hydropower project. The Kishangaga River when it enters Pakistan is called Neelum River and under the Waters Treaty, the country that will complete its project first will have water priority rights to the Neelum River.

Moreover, Pakistan, according to the SDPI study, would also sustain colossal losses in terms of degradation of environment around the Neelum Valley owing to which a reforestation development programme would be the first victim. Likewise, the likelihood of the poor dwellers of the valley that bank on fishing in the river will also be adversely affected.

The study also reveals that during the lean period, which is seven months of the year, 85% flow at Taobutt will be reduced after the completion of the Kishangaga Hydroelectric Project (KHEP). Based on twenty years of river flow data, annul generation especially in winter would be reduced to around 568 (GWh), as against the total designed annul generation of 5,178 GWh. The reduction of generation will cost an annul loss of around $140 million (Rs12.1 billion).

The study further discloses that the worst impact of the Kishangaga project will be on four already planned hydroelectric projects to be built by Wapda, and AJK Electricity Board. These projects are 255MW HEP (Hydro Electric Power) at Dudhnial, 24MW HEP at KEL and two 21MW HEP at Followai and Taobat. The total electricity generation of these projects stands at 1,900GWh annually. The financial impact of the Kishangaga project on hydropower projects would hover at around $74 million.

The Kishanganga Hydroelectric Project (KHEP) is located on River Kishanganga (called Neelum River in Pakistan), a tributary of River Jhelum in Baramulla district of Jammu and Kashmir. The Indus Water Commissioner raised some objections and the earlier project with an envisaged height of 592 metres and pondage of 1,69,000 acres feet was reduced to 122 feet and 87,000 acre-feet. However, the original design and size of 24 km long tunnels to divert the water of Neelum River to Jhelum River remained unchanged. The construction of a tunnel is in progress, and this tunnel will divert the water of the Kishanganga River through a 24 kilometres tunnel dug through the mountains to Bandipore where it will join the Wular Lake and then Jhelum River.

The joint-venture partner Hindustan Construction Company (HCC) and Halcrow are jointly executing the KHEP project. The project was started in 2007 and is likely to be completed by 2014.

The Neelum Valley is a Himalayan gorge in Gilgit-Baltistan of Pakistan, along which the Neelum River flows. This green and fertile valley is 250 km in length and stretches from Muzaffarabad all the way to Athmuqam and beyond to Taobutt.

Impact on Agriculture: The study mentions that the 4,50,000 dwellers of the Neelum Valley, mostly living below the poverty line, are highly dependant on agriculture. Growing rice paddies along the flat plains of the Neelum River is the main crop. To meet food security needs of the increasing population, the Government of AJK has planned to irrigate an area of 6,000 acres by lifting water from the Neelum River. The river diversion will definitely hamper the execution of planned agriculture developmental activities causing a loss of about Rs421 million annually.

The diversion will further add to the miseries of the farming community that are operating on subsistence level in this area. The affected section of the Neelum River (the Kishanganga) comprises the area from the point of diversion to the confluence point of the Neelum-Jhelum River at Domail, Muzaffarabad, which is around 230 km. Neelum Valley is non-monsoon area and agriculture is limited by irrigation, making it a highly food deficient area. Subsistence agriculture is the only source of livelihood. With Cropping intensity of 101% an area of 41,057 acres is dependent on irrigation water in the likely affected part of the Neelum Valley.

During the lean period, water from the sub-basins can either be used for irrigation or for urban requirements. Naturally the household/urban water requirements of the population settled along the Neelum River banks will be given preference; hence agriculture will be forgone forcibly, and the livelihood of poor farming communities living in 247 revenue villages will be adversely affected.

Impact on forestay: Nine nurseries, having an area of 15 acres nourishing almost 3 million plants, totally dependent upon the waters of Neelum River, will dry down to death. This will badly hamper the reforestation development programme and cause a loss of Rs20 million annually.

River diversion will complete Change of Micro Climate along the River and pose direct threat to various junks of forests (around 32,000 acres of alpine forest blend with blunted Deodar, Kail and Fir plants). Estimated economic loss to fish production will adversely affect the livelihood of poor dwellers of the valley, most of whom are already below poverty lines.

Impact on fishers: Brown and rainbow Trout fish, which is main species and annually more then 1,200 tons, is being sold to local and international market, earn Rs280 million and will be adversely affected.