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Would You Like to Build This Dam (With a Little Bribe)?

Pakistan’s government is currently considering building the Hingol Dam, a $400 million irrigation dam in the mountains of Balochistan Province. The project is controversial because it would impact a national park and a centuries-old temple which is revered by the region’s Hindu population. A few weeks ago, I got an e-mail from an engineering firm in Pakistan. Out of the blue, the firm offered me the contract to build the Hingol Dam and four similar projects. The offer came as a surprise because even though I am a dam expert, I work for an environmental organization, have never built a dam before, and am quite skeptical of such projects.

Perplexed, I wrote back asking for more information. The engineering firm, which lists major international companies among its customers, told me they could get the contract for a modest commission, or by forming a joint venture with me. “Please be informed that we can win this tender for you if you are interested,” the firm’s chief executive assured me. When I asked how exactly this would work, he told me that he would prefer to discuss the details on the phone.

At this difficult time, a lucrative contract would come handy. I didn’t take the bait, but was intrigued to see evidence of corruption in the act, after I had written about this topic for many years. I knew that the Hingol contract was only the tip of an iceberg. According to Transparency International, public works are the world’s most corrupt sector – more corrupt than even oil or arms trade –, and Pakistan’s water sector is particularly affected by fraudulent practices.

Pakistan has the world’s largest contingent irrigation system. The country is criss-crossed by large canals, drainage highways and some of the world’s biggest dams. Yet the system is in deep crisis. More than 60 percent of the irrigation water is lost before it reaches the roots, and average crop yields are much lower than in neighboring India. Because so much water is diverted, the mighty Indus no longer reaches the sea most of the time, and the Indus Delta is eaten away by coastal erosion. Almost 5,000 square kilometers of arable land have been lost to the sea, while the waste of water causes massive problems of waterlogging and salinization further upstream.

Plugging the leaks of this wasteful system would make more sense for farmers, tax-payers and the environment than building new dams and canals. Yet this is not happening – because of corruption. Pakistan’s water authority is considered to be one of the country’s most corrupt institutions. Top positions are sold at a high price, and the officials need to recoup the purchase of their positions through kickbacks. They can do so by offering lucrative contracts such as the Hingol Dam, not through water conservation measures and other efficiency improvements. The poor farmers who sit at the end of the leaky canals and the environment pay the price for this perverse system.

Peter Eigen, the founder of Transparency International, says that such a perverse allocation of resources is a global problem in the infrastructure sector. “Corrupt government officials steer social and economic development towards large capital-intensive infrastructure projects that provide fertile ground for corruption,” Eigen wrote in a report which I had the chance to co-author. And the independent World Commission on Dams noted: “Decision-makers may be inclined to favor large infrastructure as they provide opportunities for personal enrichment not afforded by smaller or more diffuse alternatives. The consequences frequently directly affect the poor and the environment.”

Now that I have seen a glimpse of such corruption in practice, I am sure curious to find out who will eventually get the Hingol Dam contract.

 

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