Mohmand Dam cost more than doubles to Rs 666 billion; completion slips years past 2025

Mohmand Dam will now cost Rs 666 billion, more than double the Rs 310 billion approved in April 2018, according to a revised estimate that the Water and Power Development Authority (WAPDA) put before the Central Development Working Party (CDWP) this week, ProPakistani reported on Saturday. The CDWP ran out of time and took no decision. The original target for completion was September 2025.

The numbers

(The 2018 component figures are worked back from the increases WAPDA reported.)

By last month Rs 275 billion had been spent and construction was about 57% complete. The dam is being built by China's Gezhouba Group in a joint venture with Pakistan's Descon Engineering.

Why the cost rose

WAPDA told the Planning Commission four things drove the overrun:

1. The rupee. About 51% of the increase comes from the rupee's fall against the dollar, because part of the contract is paid in foreign currency. In April 2018 a dollar cost roughly Rs 115; today it costs about Rs 277 on our dollar rate page.
2. Design changes made after the original approval.
3. The 2022 floods, when the Swat River damaged the tunnels built to divert water around the site and stopped work for a long time.
4. Security problems in the area.

The Planning Commission has called the delays and overruns concerning. It has asked WAPDA for the payment details of every dollar contract, saying that simply converting old contracts at today's exchange rate is not enough, and has recommended a third-party audit of the money spent and the physical work done, plus a revised financing plan.

What happens next

A revised cost of this size needs the CDWP's clearance first and then final approval from the Executive Committee of the National Economic Council (ECNEC). Once finished, Mohmand Dam is meant to add 1.29 million acre-feet of water storage on the Swat River in Khyber Pakhtunkhwa, along with hydropower for the national grid.

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