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Public finance

Pakistan's Water Storage Crisis Deepens as Funding Declines Amid Indian Threats

Strategic Insights

— 2 min read

Pakistan's plans to improve its water storage and dam infrastructure have hit a roadblock due to declining allocations and delayed cash flows. The decision to reduce annual funding for water-sector initiatives under the Public Sector Development Programme (PSDP) and Annual Development Programme (ADP) is not only alarming but also comes at a time when India has threatened to curtail downstream river flows to Pakistan. This has exacerbated the already critical water storage situation in the country. The water minister has allocated Rs133 billion under PSDP, Rs2 billion less than the previous fiscal year, which ends on June 30, 2025. The Ministry of Water Resources admitted that it failed to complete 25 out of 59 water-sector projects during the fiscal year 2024-25, with only 34 projects completed at a cost of Rs295 billion. The allocated funds for the ongoing fiscal year amount to Rs107.664 billion, with the expenditure on various projects remaining over Rs93.5 billion till April 30.

Key Takeaways:

  • Pakistan's water storage crisis has worsened due to declining allocations and delayed cash flows for water-sector initiatives.
  • The Ministry of Water Resources failed to complete 25 out of 59 water-sector projects during the fiscal year 2024-25.
  • Only 34 projects were completed at a cost of Rs295 billion, leaving a quarter of the planned work unfinished.
  • The government allocated Rs133 billion under PSDP, Rs2 billion less than the previous fiscal year.
  • Water experts have expressed strong concern over this decline in funding, especially given India's unilateral suspension of the decades-old Indus Waters Treaty and its threats to restrict Pakistan's river flows.
  • Wapda anticipates completing Diamer-Basha by 2029, Mohmand by 2027-28, and Nai Ganja by 2026 but faces numerous challenges including security concerns and lack of international funding.
  • Eight mega projects, including Diamer Basha Dam, Mohmand Dam, Dasu Hydropower Project, Tarbela 5th Extension, Kurram Tangi Dam Stage-1, Nai Gaj Dam, Kachhi Canal Extension, and Greater Karachi Bulk Water Supply Scheme (K-IV), are scheduled for completion by 2029-30 and will double Wapda hydel generation to 19,500MW, generate 9.7 MAF additional water storage, and provide 35,000 job opportunities.

Statistics:

  • Rs133 billion allocated under PSDP (Rs2 billion less than the previous fiscal year)
  • 59 water-sector projects ongoing, with 34 completed at a cost of Rs295 billion
  • 25 water-sector projects not completed during the fiscal year 2024-25
  • Rs107.664 billion allocated for the ongoing fiscal year
  • Rs93.5 billion expenditure on various projects till April 30
  • 13.7 MAF of water storage against an annual inflow of 145 MAF
  • 80% of Pakistan's cultivable land relies on Indus Basin irrigation
  • 22m acres remain uncultivable primarily due to inadequate water availability and distribution

Sources:

  • Ministry of Water Resources
  • Public Sector Development Programme (PSDP)
  • Annual Development Programme (ADP)
  • Wapda spokesman
  • Jawaid Latif, former Wapda member (water)
  • Riaz Hussain, water resource engineering specialist

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