ISLAMABAD: The federal government has earmarked approximately Rs179 billion for around 44 water sector and hydropower development schemes under the Public Sector Development Programme (PSDP) 2026–27, including 43 ongoing and one new project, amid continued fiscal constraints.
According to the Ministry of Planning, Development and Special Initiatives, the total allocation includes around Rs106.62 billion in local funding requirements and Rs72.37 billion in rupee cover obligations.
For ongoing hydropower projects, about Rs42.66 billion has been set aside. Major allocations include Rs25 billion for the Dasu Hydropower Project (Stage-I), Rs4.28 billion for the rehabilitation of the Warsak Hydroelectric Power Station, Rs3.4 billion for the 1,410 MW Tarbela 5th Extension project, Rs3 billion for the 54 MW Attabad Lake Hydropower Project, and Rs2.06 billion for the rehabilitation of the Dargai Hydropower Station.
Other key hydel allocations include Rs2.7 billion for the 34.5 MW Harpo Hydropower Project, Rs1.48 billion for the refurbishment and upgradation of Mangla power station units to increase capacity from 1,000 MW to 1,310 MW, and Rs736 million for capacity enhancement of the Chitral Hydropower Station.
In the water sector, significant allocations include Rs25 billion for the Diamer Basha Dam Project (including Tangir Hydropower component) and Rs7 billion for land acquisition and resettlement activities under the same project, pending revised PC-I approval. The Mohmand Dam Hydropower Project has been allocated Rs39 billion.
Other notable allocations include Rs4.59 billion for the Mangla Dam raising project, Rs5.75 billion for installation of a telemetry system for real-time water flow monitoring across 27 key sites of the Indus Basin Irrigation System, and Rs4.87 billion for the Kachhi Canal Project.
For dam construction initiatives in Balochistan, allocations include Rs1.09 billion for Package-III (20 dams), Rs3 billion for Package-IV (23 dams), Rs5 billion each for the Awaran Dam and Panjgur Dam projects, and Rs1.45 billion for the Garuk Storage Dam in Kharan. Additional funding has also been earmarked for the remodelling of the Pat Feeder Canal System in Naseerabad.
The PSDP also includes Rs2 billion for the Flood Protection Sector Project-III and Rs3 billion for the Flood Management Enhancement in the Indus Basin (JICA-funded grant project).
Despite these allocations, several ongoing schemes are set to receive only limited funding in the form of minimal releases, with some projects receiving only minor allocations in the millions. Notably, the 4500 MW power generation component of the Diamer Basha Dam Project has been allocated just Rs500 million.
Overall, the proposed PSDP 2026–27 water sector outlay reflects a total of around Rs135.83 billion for ongoing schemes, highlighting continued prioritisation of large-scale hydropower and water infrastructure projects despite fiscal constraints.
Story by Mushtaq Ghumman
