• Estimate skyrockets from Rs479bn to Rs1.74tr
• Date of completion pushed to Nov 2028
• Minister blasts Wapda for awarding KKH contract in foreign currency
ISLAMABAD: The Central Development Working Party (CDWP) on Friday expressed strong dismay over the “astronomical increase” in the estimated cost of the Dasu Hydropower Project, which has surged to approximately Rs1.74 trillion due to massive mismanagement and prolonged delays.
The CDWP meeting, chaired by Planning and Development Minister Ahsan Iqbal, focused heavily on the sharp cost escalation of the Dasu Hydropower Project. The CDWP cleared a total of 10 development projects with an estimated cumulative cost of Rs1.83tr. Of these, four projects worth Rs14.312 billion were approved directly by the CDWP, while six projects — involving a total cost of Rs1.82tr — were recommended to the Executive Committee of the National Economic Council (Ecnec) for final approval, as the CDWP cannot approve projects exceeding Rs7.5bn in cost.
The most significant project on the agenda was the Dasu Hydropower Project (Stage-1), whose estimated cost has ballooned from Rs479bn in 2014 — with an original completion target of December 2019 — to Rs1.738tr, with the new completion date pushed to November 2028. The delay and massive cost overrun have been attributed to mismanagement and inordinate delays, drawing strong criticism during the meeting.
Wapda’s parent department — the Ministry of Water Resources — remained uncertain about meeting project deadlines. The implementation of Dasu HPP is a clear example of poor project management by Wapda, from land acquisition to contract awards and beyond. Despite this, there is still no indication of achieving the planned progress on time. All project-related issues must be resolved to ensure timely completion, the ministry told the meeting.
The project involves $2.26bn (almost Rs1.45tr) of foreign financing, mostly from the World Bank at a markup ranging between six per cent and 15pc for different segments.
The CDWP referred the project to Ecnec for approval subject to Wapda rationalising the cost and answering the queries. Reviewing the project, Mr Iqbal emphasised the strategic importance of the Dasu project for water and food security, but “expressed serious concern over massive cost escalation from the original Rs479bn to almost Rs1.73tr due to delays and mismanagement in the project,” an official statement said.
The meeting directed that a third-party validation be obtained for the astronomical increase in the revised PC-1, according to the statement. The primary objective of the Dasu project is to enhance the country’s power generation capacity by harnessing its hydropower potential through river-based projects, thereby reducing the carbon footprint and utilising clean, renewable energy resources.
The planning minister underscored the need for swift completion of the project in the national interest.
He said that previously, the estimated construction cost was Rs479bn with Rs120bn already allocated for land acquisition and around Rs400bn already spent.
However, the minister attributed the substantial cost escalation — from Rs479bn to Rs1.73tr — to “mismanagement and delays and lack of progress during the previous government” which he said had disastrous consequences for development projects in every field.
The minister took serious notice of the fact that, despite Ecnec’s clear directives to appoint an independent, full-time project director for all projects exceeding Rs3bn, Wapda had failed to do so for the Dasu Hydropower Project. It was also revealed that the project lacked a professional chief financial officer.
Expressing concern, the minister questioned, “How is Wapda running a project of this magnitude without a qualified and competent CFO?” His frustration deepened upon learning that Wapda had awarded the contract for the construction of a 66-kilometre section of the KKH in foreign currency.
Asked why a road construction project was awarded in foreign currency, Wapda was unable to provide a satisfactory explanation, according to the statement. The minister termed it “a criminal negligence”.
Projects referred to Ecnec
The meeting also referred to Ecnec for approval the Rs28bn project ‘Getting Results Accesses and Delivery of Quality Education Services in Balochistan (new)’.
The project, to be financed through foreign funding of $100m from the World Bank, is designed to address systemic challenges in Balochistan’s education sector.
The meeting approved “Establishment of Sub-Campus Quaid-i-Azam University Islamabad at Sharaqpur, Sheikhupura” at an estimated cost of Rs3.89bn on the condition of provision of land by the Punjab government and approval by the university syndicate.
The CDWP also approved three projects in science and technology sector, namely “Prime Minister’s Initiatives — Support for IT Startups, Specialized IT Trainings and Venture Capital — at a cost of Rs5bn, “Strengthening of Ministry of Planning, Development & Reform in IT” at a cost of Rs579.81m and “National Semiconductor HR Development Programme Phase-I” at a cost of Rs4.844bn.
The project “Construction of Customs Complex at Sost (Part A) and Construction of Customs Digital Enforcement Stations by FBR along the rivers Indus, Hub and in Balochistan (Part B) (revised)” worth Rs16.1bn was also referred to Ecnec for approval.
The “Sindh Flood Emergency Rehabilitation Project (SFERP) Phase-II” project worth Rs12.26bn and Balochistan Water Security and Productivity Improvement Project (BWS&PIP) — Improvement of Quetta Water Supply System (new) project worth Rs9.83bn were referred to Ecnec.
Another water-related project “Flood Management of Kachhi Plains under the BWS&PIP” at cost of Rs17.17bn was also referred to Ecnec. This project will be financed through World Bank’s IDA credit.
Published in media, April 12th, 2025
American Dollar Exchange Rate