Pakistan Slashes Funding For Key Dams Even As India’s IWT Suspension Raises Water Stress
Despite an ongoing water crisis that is expected to get worse, Pakistan government has slashed funding for the water resources ministry. Image courtesy: RNA
Pakistan’s federal government has slashed allocations for the Ministry of Water Resources in the 2025–26 Public Sector Development Programme (PSDP). The move comes despite Pakistan suffering heavy water stress due to India putting the Indus Waters Treaty (IWT) in abeyance.
The Pakistani Rupees (PKR) 133 billion earmarked for the ministry marks a reduction of PKR 2 billion from the previous financial year. Even as climate stress heightens the country’s water vulnerability, Pakistan’s focus remains on boosting the military’s budget and catering to the Army’s needs.
Despite plans for multiple high-profile dam and canal projects, the Ministry of Water Resources failed to complete nearly half of its initiatives in the 2024–25 fiscal year, according to a report by Dawn.
At the heart of the growing concern is the mismatch between urgent national needs and diminishing financial commitments.
Why is the funding cut alarming for Pakistan?
The funding reduction comes at a time when India has put key provisions of the IWT in abeyance and accelerated upstream river development, especially on the Chenab. This poses serious risks to Pakistan’s already fragile downstream flows.
Experts warn that Pakistan’s annual water inflow of 145 million acre-feet (MAF) is met with only 13.7 MAF of current reservoir capacity, making the country highly vulnerable to seasonal fluctuations, poor rainfall, and transboundary manipulation.
The Diamer-Basha Dam, Mohmand Dam, and Greater Karachi Water Supply Project (K-IV) are among the initiatives now facing execution delays due to inconsistent funding and disbursement, further compounding the threat to food and water security, especially in Punjab and Sindh.
Which major projects are being affected by budget constraints?
The PSDP allocation of PKR 133 billion includes PKR 95 billion dedicated to just 15 key projects, but implementation lags persist. Pakistan Water and Power Development Authority (Wapda) has admitted that 25 of 59 water-sector projects remained incomplete this fiscal year.
While PKR 295 billion was spent on 34 completed projects, core dam and canal works are progressing slower than expected.
Key examples include:
- Diamer-Basha Dam (4,500MW) – slated for completion by 2029
- Mohmand Dam – delayed since its first feasibility in 1985; expected by 2027–28
- Dasu Hydropower Project (Stage I) – facing cost escalations due to security concerns
- Kurram Tangi Stage-I – projected for December 2025
In addition, telemetry systems, vital for real-time monitoring of Indus basin flows, remain underfunded with only PKR 4.4 billion allocated.
According to Wapda, once completed, these projects are expected to add 9.7 MAF in storage capacity and over 9,000MW of hydropower generation critical for energy and agricultural stability.
What structural and political obstacles are blocking timely project execution?
Multiple former Wapda officials and experts have flagged recurring issues:
- Cash flow delays and inflation that slow procurement and construction
- Design changes and cost overruns in legacy projects
- Exchange rate pressures affecting international procurements
- Lack of federal-provincial coordination, with provinces demanding net hydel profits without reinvesting in water projects
- Security concerns, particularly in the Dasu project area, which increase contractor risk premiums
One expert cited the Mohmand Dam as a symbol of systemic delays — planned as early as the 1980s, it’s still incomplete after nearly four decades.
Moreover, international lenders are reportedly hesitant to fund large-scale water infrastructure in Pakistan due to unclear revenue models, making financing more dependent on the state’s already constrained fiscal space.
Is Pakistan doing enough to secure its water future amid India’s upstream build-up?
Experts say no. The Chenab River, to which Pakistan has exclusive rights under the Indus Waters Treaty, still lacks a single major storage dam, unlike India’s multiple run-of-the-river projects in the same basin.
Projects like the Chiniot Dam— shovel-ready but yet to be greenlit— represent misplaced priorities. Without multipurpose dams, flood control mechanisms, and smart irrigation, Pakistan is poised to lose surface runoff and leave millions of acres uncultivated.
