Neelum-Jhelum project’s cost further increases

Islamabad: The construction of Pakistan's most strategic 969MW Neelum-Jhelum Hydropower Project the cost of which has further sky rocketed by Rs96.021 billion up to Rs500.343 billion from Rs404.331 billion has virtually been stopped from July 24, 2017, as employees of the project have gone on strike. 

“This will factually delay the commissioning of the project as first turbine of the much touted project is scheduled to get operational in February 2018,” a senior official told The News.

The revised PC-1 showing the massive increase in the cost of the project up to Rs500.343 billion is feared to face more delay on account of the strike. The cost of the project is being revised for the fourth time.  Two main increases in the cost of the project came from raise in the cost of civil works lot C1, C2 and C3 that has swelled from  Rs135.209 billion to Rs158.340 billion. The other main increase of Rs21.616 billion is included in the project cost because of foreign exchange loss. 

The strike that led to halt all kinds of work at the site of the project emerged when Wapda has denied sucking in at permanent basis the 234 officials who have been working for this project for the last 8-10 years. This has ignited the situation to an alarming level forcing all employees to go on strike. Wapda has rather communicated to them that it will hire more employees saying the said 234 officials will not be absorbed in the organisation. The top management of the project has limited itself to Islamabad office and is reluctant to go to the site of project.

In Islamabad office, staff of the Neelum-Jhelum Hydropower Company also went on strike, but the top management asked them to call off the strike as they are in Islamabad, not at the site in AJK, reveals the directive of the top man of the company of which a copy is also available with The News.

Wapda spokesman says the employees have nothing to do with Wapda as the employees who are on strike belong to the Neelum-Jehlum Hydropower Company (NJHPC) which is independent on its decisions. He said that contractor of the project is working on the site and there is no fear that the project would delay anymore.

NJHPC Chief Executive Brig (r) Zarin confirmed that over 200 employees have gone on strike; their some demands are accepted, but some are very difficult to accept as these demands do not fall under his jurisdiction. The borad of directors of the company has the powers to decide about them. 

Mr Zarin said that the employees on strike wanted HR policy for them, but no decision could be made to this effect as the convener of the HR committee at the eleventh hour quit owing to which no progress is made on HR policy. They wanted to be absorbed in Wapda, but it was to be decided once the HR policy is made. He said that the said employees had also filed the case against Wapda for not being absorbed in the organisation and in that case Wapda pleaded that they are not Wapda  employees as they were hired by the NJHPC which has its own board of directors and is independent in its decisions.

Zarin said that their demands about overtime allowance, leave compensation and others have been accepted, but ensuring the permanence of their jobs is not possible for him to approve as this demand can be accepted only by the board of directors if HR policy is made. When his attention drawn towards to non-payment of the salary to the said officials, he said that the salary is supposed to be worked out by some of them and they themselves are on strike.

 Coming towards the increase in the cost of the project, Brig Zarin admitted that cost of the project has increased further by over Rs96 billion to Rs500.343 billion and to this effect the revised PC-1 has been submitted to the ministry of water and power which will at appropriate time submit to the CDWP (central development working party) that will recommend to Ecnec for final approval.

The project is the art-of-the-state which is being branded as the new wonder of Pakistan because the 10 percent of the project is on surface and 90 percent underground. The cost of the project is being revised for the fourth time. 

The latest document available with The News showing the history of the project reveals that Executive Committee of National Economic Council (ECNEC) in 2002 approved the project of Neelum-Jhelum Hydropower Project at the cost of Rs84.502 billion. The cost of the project scaled up to Rs277.502 billion which the ECNEC approved in 2012 and then its cost again surged up to Rs404.331 billion in 2015  and now the cost is being revised up to Rs500.343 billion. In 2015, the project’s cost was hiked by 86 percent and now it is being increased further by Rs96 billion up to Rs500.343billion.

The documents about the bifurcation in the increase of the project cost by over Rs96 billion in various heads unfold that the cost of civil works lot C1, C2 and C3 has swelled by Rs23.130 billion from Rs135.209 billion to Rs158.340 billion. The cost of Hydraulic works lot H1, electrical works lot E1 and mechanical works lot M1 has increased by Rs10.167 billion from Rs30.056 billion to Rs40.224 billion. The cost to be incurred on engineering and supervision has also surged by Rs7.210 billion to Rs19.039 billion from Rs11.829 billion.

The cost on security arrangements has also been increased from Rs1.5 billion to Rs1.8 billion. The increase in the cost of the project came in on account of foreign currency loss has been worked out at Rs21.616 billion. In the head of land acquisition and environmental mitigation, cost has increased by Rs2.966 billion from Rs4.271 billion to Rs7.237 billion. And on top of that the cost to be incurred on administration of the NJHPC has been increased by Rs409.33 million to Rs3.97 billion from Rs3.56 billion.