ISLAMABAD: The government has failed to make the proposed dam cess part of the finance bill for FY26 because there is no go-ahead from the IMF yet.
This proposal was generated from the top mandarins of tax collecting agency, the FBR. However, the authorities could not make it part of the finance bill for FY25, which is currently in the National Assembly for approval purposes.
The IMF authorities sent many queries to Pakistan mainly questioning the urgency for imposition of the dam cess. The IMF has been told that India has held the Indus Waters Treaty 1960 in abeyance and is manipulating time to time through dams (water storages) for its hydropower projects erected on Pakistan rivers – Jhelum and Chenab, the water releases which are destined to reach Pakistan and damaging the sowing of crops in Pakistan (Punjab). India did it many times on Chenab river. “India under the Modi administration can go for diversion of waters from Pakistan rivers to its own rivers. Pakistan has already declared the manipulation of water and any diversion of its water as an act of war.”
However, in the winter season, when there will be less water is Jhelum and Chenab rivers because of ice in catchment areas and reduced water in streams emanating from water catchment areas to Pakistan rivers, India can create more problems for Pakistan by storing water in dams of its hydropower projects and it would damage the winter crops production in Pakistan resulting into food insecurity.
The officials said right now the Sindh Irrigation Department has written letters to Sindh farmers that there is no water available enough to cultivate their whole cultivable lands which is why the water irrigation has been reduced in Sindh by 10 times say watering from 400 acres has plummeted to just 40 acres of land. This is the present appalling situation in the low riparian federating unit of Pakistan.
“So we have informed the Fund how important speedy construction of dams is for Pakistan to increase its storage capacity.” The officials said that if the IMF allows the imposition of dam cess, the government will make it part of the budget later on through an act of parliament. However, through a presidential ordinance, it can be imposed with immediate effect.
When asked as to how the government will collect the dam cess either through electricity bills or gas bills, the officials said that the modalities to this effect are yet to be finalised. “However, the Ministry of Water Resources had suggested to the government to persuade the provinces to create a dam cess fund from their NFC shares to provide perpetual financing every year for speedy construction of dams of paramount importance.”
