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The World Bank and Pakistan's Water Sector

A recipe for conflict and deadlock

Last week Pakistan’s ruler General Musharraf announced that he would temporarily shelve plans to build the politically untenable and widely contested Kalabagh Dam. Instead, General Musharraf proposed construction of a slightly smaller dam on the Indus. With feasibility studies and environmental assessments still not complete, the Bhasha Dam may not be much better. Yet Pakistan’s Water and Power Minister says construction of roads will start in February, and the World Bank has signalled its readiness to consider financial support. By Peter Bosshard.

The World Bank largely refrained from financing mega infrastructure projects during the past decade, but recently returned to the bad old days. Unfortunately, big dams are not the answer to Pakistan’s water woes. Investments to maximize the existing system’s capacity and reduce its inequalities, improve groundwater recharge, and harvest rainwater should take priority. But by promoting the Kalabagh and Bhasha dams, the Bank is destabilizing an already conflict-ridden country and further marginalizing Pakistan’s poor.

Pakistan’s Indus Basin Irrigation System is the world’s largest water diversion scheme, with 59,000 kilometers of canals and distributaries punctuated by large dams. Large landowners and elite bureaucrats benefit from the system’s non-transparent and corrupt manner of water allocation. Faulty operation and maintenance and the promotion of water-hungry crops such as sugar waste vast amounts of water. Meanwhile, poor farmers are left on the fringes, without adequate water for irrigation.

The Indus Basin Irrigation System has also wreaked havoc on the environment. Upstream water diversions have turned large tracts of the Sindh province to desert. Sediment is trapped in the reservoirs instead of carried down the river to replenish the Indus delta, which is being eaten away by the sea. Over-irrigation and poor drainage have left thousands of square kilometers of land water-logged and saline.

* The Bank's major role
The World Bank has played a major role in promoting and financing Pakistan’s misguided and unsustainable water policy. Since the country’s creation in 1947, the financial institution has spent almost $20 billion on Pakistan’s water sector (in 2005 prices). In the 1950s, the World Bank brokered a water treaty between Pakistan and India that required the construction of two of the world’s largest dams and a massive river diversion of rivers. These projects have forcibly displaced tens of thousands of people, many of whom were never adequately compensated.

Paradoxically, while financing these mega-dams and canals, the World Bank has also pointed out the wastefulness of Pakistan’s irrigation system, the corruption plaguing the allocation of water, and the need for reform. In the 1980s, the World Bank approved four projects to rehabilitate the existing canal system in order to stem water losses. But when the country’s water bureaucracy resisted change and misused the loans, the World Bank looked the other way. As an internal evaluation found, “the Bank did not insist on the implementation of the agreed strategy against the pressures of special interests,” and “the Bank’s concern to keep disbursement flowing reinforced this focus.”

The World Bank’s evaluation department found that renovating watercourses in Pakistan could increase irrigation water supply at one-fifth the cost of building new large dams. Yet in September 2005, the Bank presented a “new” strategy for Pakistan’s water sector, favoring the construction of more mega-dams on the Indus. Apparently, it has learned little from the decades of failed projects, increasing environmental damage, and growing social inequality.

Presenting the World Bank’s 2005 water strategy for Pakistan, the World Bank’s senior water advisor John Briscoe said: “Pakistan has to invest, soon, in costly, contentious but essential large dams.” In particular, Briscoe supported the construction of the massive Kalabagh Dam, which would cost an estimated $15 billion and forcibly displace 132,000 people.

* Alternatives exist
General Musharraf used the World Bank’s support to launch an all-out campaign for the construction of the Kalabagh, which triggered national conflict. Three of Pakistan’s four provinces and numerous civil society organizations throughout the country registered their strong opposition to the construction of the mega-dam. So General Musharraf conceded that Kalabagh would not be built for the time being, and vowed to move ahead with the next dam on the list.

Alternatives to Pakistan’s wasteful, top-down system of providing water through massive, centralized projects exist. Poor farmers are using innovative, low-cost technologies to make better use of the existing water resources. They are also planting crops that depend on less water, fewer chemical inputs and more on farmers’ abundant labor. These alternatives empower local farmers and not centralized water bureaucracies. But the World Bank has so far not backed decentralized approaches for meeting Pakistan’s water needs. With its high-risk strategy, the Bank has instead triggered conflict, reinforced the deadlock in Pakistan’s water sector, and wasted valuable time.

Peter Bosshard is Policy Director at the International Rivers Network based in Berkeley, CA.

(Posted: 27 January 2006)

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