Gilgit-Baltistan:FoDP task force gives top priority to DBD

Posted on January 23, 2012

ISLAMABAD (Dawn): The Friends of Democratic Pakistan (FoDP) has prioritised $28.2 billion water and hydropower projects to be completed by 2020 and decided to follow the guidelines and safeguards set by the Asian Development Bank for providing funds and technical assistance.

This is the crux of the final report of FoDP’s water sector task force after including suggestions of the stakeholders. The report completed in about a year is scheduled to be launched on Feb 20.

“It is Pakistan’s political and policy leaders who will have to decide the course of action” — whether to have a binding commitment from provinces and the lending agencies or follow the normal decision process of five-year plans, annual budgets and partnership strategies with lenders about a roadmap.

The report says Pakistan has one of the largest, complex and integrated water system but despite greater issues its policy leaders were ‘flying almost blind’ despite an ominous threat from snow and glacial melt on the Indus system arising out of climate change.

The task force puts $12 billion Diamer-Bhasha dam in Gilgit-Baltistan as ‘priority number one’ for implementation after unanimity of views among all domestic stakeholders and bilateral and multilateral lenders.

Second on the list are six major projects with total cost of $14 billion — Kurram Tangi, Munda, Dasu, Kohala, Golen Gol and Bunji, to be developed in Khyber Pakhtunkhwa, Fata, AJK and Gilgit-Baltistan. There was unanimity among the member countries, lenders and stakeholders in Pakistan on the need for major dams and top priority for Bhasha dam.

On resistance from some provinces, the controversial Kalabagh dam has been dropped from the priority list, although the multilateral lenders had strongly recommended its construction.

Understanding the difficulties in taking major political decisions in an election year, the task force has also called for provincial strategies for the ‘next governments’ but advised the lending agencies to include these projects in the programmes already in the pipeline.

The task force has noted opposition from the Federal Flood Commission to putting responsibility of inspection of existing infrastructure and embankments on Wapda and left the issue for the government to decide.

The lenders have endorsed Punjab’s move to put in place an Asset Management Plan for embankments and to develop a financial method for maintenance of major embankments. Provinces believed FFC’s inspection of embankments was not up to the mark.

However, the task force notes “serious, cumulative problems of neglect of maintenance of major embankments by the provinces”.

It was agreed that good institutional, social and environmental policies were needed to attract external investment.

The task force did not agree to follow recommendations of the World Commission of Dams and decided to follow safeguard requirements of the ADB.

Despite insistence by some provinces that existing revenue sharing from large dams was sacrosanct, the task force said it would continue to advocate that Pakistan should adopt good global practices involving a formula of royalty sharing among affected provinces and local people and move away from the Tarbela-like arrangement that transfers maximum benefits to the province where the power house is located without giving project benefits to locally displaced communities.

The task force agreed that the 1991 accord was a great asset for water sharing among the provinces but urged to put in place an institutional framework that reduced current large political elements in its implementation and for better predictions for rabi and kharif seasons and transparent measurement of flows and losses to end mistrust.

The report notes strong agreement for improved on-farm water management (OFWM), the need for new infrastructure on canal storage and control structure.

Likewise, strong commitment has emerged for small and medium dams which should be developed by provinces but in integrated command area projects using modern technologies.

For this, all provinces have agreed to the objective of full cost recovery from users.

For better agricultural productivity, the stakeholders have also agreed to a $315 million assistance for OFWM, $140 million for small dams, $100 million for spate irrigation and $500 million for improved management of main canals.

The stakeholders have agreed to put in place new operating rules for major future dams and projects — moving away from agriculture as top priority to power and flood control whose benefits are larger than agriculture.

The FODP agreed to provide $500 million for a flood management programme to be completed by 2016.

The report notes major issues with bulk water transmission in Karachi, unsustainable groundwater use in Quetta posing an existential threat and deplores “no indication of willingness to address these challenges”.

It has also found broad agreement that the present institutional model is broken, most obviously financially as no utilities have operating ratio greater than 50 per cent, creating problems in meeting water needs in growing city peripheries and choking sewerage and sanitation services. It says the first step to address these issues will be for the political leadership to spend political capital for financial sustainability.

The task force says the FoDP should stay away from reforming city institutions unless there is a strong political commitment and then consider financing ‘transition costs’ for getting to financial sustainability.