India protests as China takes up hydel project in area illegally occupied by Pakistan

A new irritant has emerged in New Delhi’s relations with Beijing, as the Power Construction Corporation of China is now set to build a hydro-electric plant in Gilgit-Baltistan, which is part of the area India accuses Pakistan of illegally occupying in its Union Territory of Jammu and Kashmir.

The Power Construction Corporation of China, a.k.a. “Power China”, has tied up with the Frontier Works Organization (FWO), a construction farm of Pakistan Army, to float a consortium, which has now been awarded by Prime Minister Imran Khan’s Government in Islamabad a $ 2.75 billion contract to build the controversial Diamer Bhasha dam on Indus River in Gilgit-Baltistan.

New Delhi has since long been opposing the China-Pakistan Economic Corridor (CPEC), which passes through the areas of Jammu and Kashmir and Ladakh under illegal occupation of Pakistan. The CPEC is one of the flagship projects of China’s ambitious cross-continental Belt and Road Initiative (BRI). New Delhi opposed the BRI, primarily because the CPEC undermined the sovereignty of India.

The Water and Power Development Authority (WAPDA) of Pakistan signed the agreement with the consortium on Wednesday, awarding it the contract to build the main dam of the Diamer Bhasha hydroelectric project and an access bridge. The contract awarded to the consortium of the Power China and the FWO also covers the construction of the 21 MW Tangir Hydro-Electric plant, which has been envisaged to power the construction of the main 4500 MW Diamer-Bhasha project at a later stage.

New Delhi on Thursday responded to the signing of the contract by reiterating that the “entire territory” of the UTs of Jammu and Kashmir and Ladakh, including Gilgit-Baltistan, was and would continue to be “integral and inalienable part” of India. “We have consistently conveyed our protests and shared concerns with both Pakistan and China on all such projects in the Indian territories under Pakistan's illegal occupation,” Anurag Srivastava, spokesperson of the Ministry of External Affairs, told journalists in New Delhi.

The Diamer-Bhasha dam is proposed to be built on the Indus River in Gilgit-Baltistan. The project is envisaged to consist of a huge reservoir for storage of 6.3 million acre-feet of water and two power stations with a total installed generation capacity of 4,500 MW. Pakistan had conceived the project in 2006, but could not make much progress as international lending agencies declined to fund the project because of New Delhi’s objections.

The move by the Khan Government in Islamabad to rope in a state-owned company of China for a controversial project in Gilgit-Baltistan came at a time when New Delhi raised its pitch reasserting that the entire area was an integral part of India.

It also came when recent face-offs between Indian Army and Chinese People’s Liberation Army along the Line of Actual Control in northern Sikkim and eastern Ladakh renewed the focus on the protracted boundary dispute between India and China.