December 2004 News

Kashmir-Delhi spat stalls Wullar project

7 December 2004
The Daily Times
Iftikhar Gilani

New Delhi: Serious differences have cropped up between the federal Indian government and the government of Indian-administered Kashmir over the controversial 330-megawatt Kishanganga hydroelectric project. The Kashmir government has taken exception to the National Hydro- Electric Power Corporation (NHPC)'s decision to unilaterally withdraw the 12 percent royalty that the Power Ministry had promised Kashmir in an agreement signed a few years ago.The NHPC, which is implementing several projects in the state, says the Kishanganga project is not financially viable. 'If we are forced to shell out 12 percent of the power generated for free, we will not be able to find customers for the rest of the power in the central grid,' said an official of the NHPC. The corporation has threatened to pull out of the project if it is forced to honour the agreement. Sources here said the chief minister of Kashmir had recently taken up the issue with New Delhi. He said the state had been adversely affected by the Indus Water Treaty and demanded a fair return in terms of land and water. Meanwhile, the state government has started searching for private partners for the implementation of this project. It has also objected to the NHPC's refusal to hand over the Salal hydroelectric project on the Chenab. The NHPC was supposed to hand over the project to the Kashmir government after recovering its investment, but a state government official here said that the company was unwilling to do so despite recovering ten times its investment.The Indian Central Electricity Authority (CEA) has granted technical approval to the Kishanganga project. It had earlier withheld approval, citing financial non-viability. However, the government here is in a hurry to execute the project because Islamabad plans to construct a hydropower plant downstream on the Kishanganga, or Neelam, river across the Line of Control (LoC). The project envisages damming the Kishanganga. The proposed 103-metre high reservoir submerges almost all the serene Gurez valley along the Neelam valley of Azad Jammu and Kashmir. Water will flow from this reservoir through a channel and a 27 km tunnel dug south through the North Kashmir mountain range. The water channel will change the course of the Kishanganga by around 100 km, and finally join the Wullar Lake and the Jehlum river near the northern township of Bandipur. Currently, both the Kishanganga and Jehlum join each other at Muzaffarabad. Through the proposed Wullar Barrage project, India plans to maintain a constant water flow in Jehlum the year round. When the former state government headed by Dr Farooq Abdullah conceived of this project in 1997, it was handed over to the Kishanganga Group of Contractors (KGC), which consisted of Swedish consortium Skanska International and a few domestic companies.


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