Dispute of Hydroelectric between AJK and Pakistan

The ongoing civil unrest in Pakistan-administered Azad Jammu and Kashmir (AJK) stems fundamentally from a deep-rooted sense of economic and structural exploitation. At the very center of this grievance stands the Mangla Dam. As the world’s seventh-largest dam, situated in AJK’s Mirpur district, it embodies the stark disconnect between local resource contribution and regional economic deprivation.
The core of the dispute can be broken down into clear historical, financial, and environmental dimensions.
1. The Core Paradox: High Costs vs. Cheap Generation
The fundamental grievance of the Jammu and Kashmir Joint Awami Action Committee (JKJAAC) and the general public rests on a striking mathematical asymmetry regarding energy pricing:
- The Generation Cost: Hydroelectric power from the Mangla Dam is incredibly cheap to produce. Clean water-driven generation at the source costs approximately Rs. 2 per kilowatt-hour (kWh).
- The Consumer Cost: Despite living adjacent to the source of this cheap energy, residents of AJK were being charged over Rs. 30 per unit by mid-2023—a price packed with heavy federal taxes, fuel price adjustments (tied to expensive imported coal and thermal plants in mainland Pakistan), and distribution surcharges.
While the federal government issued a temporary emergency subsidy package in mid-2024 dropping local household tariffs down to Rs. 3 for the baseline slab, the movement demands a permanent structural framework rather than temporary fiscal handouts. They argue that as a matter of fundamental resource right, their billing should be tethered to the actual localized cost of generation.
2. The Net Hydel Profit (NHP) and Royalty Disparity
Under Article 161(2) of the Constitution of Pakistan, provinces that generate hydroelectricity—most notably Khyber Pakhtunkhwa (KPK) and Punjab—are legally entitled to a lucrative financial mechanism known as Net Hydel Profit (NHP). This is a cost-plus formula that returns substantial revenue to the generating territory based on bulk electricity supplied to the national grid.
Because AJK holds a ambiguous, semi-autonomous constitutional status and is not officially a province of Pakistan, Islamabad has historically denied it equal NHP status. Instead, AJK is paid a vastly lower, fixed rate called a Water Use Charge (WUC), which sat at a meager Rs. 0.15 per kWh for decades.
Locals view this structural exclusion as institutionalized revenue theft, pointing out that AJK injects roughly 3,500 Megawatts of cheap, green capacity into the Pakistani national grid, yet receives only a fraction of the financial windfall granted to regular provinces.
3. The Generational Trauma of Displacement
The push for cheap electricity is also driven by deep emotional and historical trauma. The construction and subsequent expansion of the Mangla Dam forced massive local sacrifices:
- The Initial Displacement (1967): The original construction inundated over 118 villages and displaced more than 100,000 native Kashmiris. Entire ancestral lands and the old city of Mirpur were permanently submerged to provide water security and power to Pakistan’s industrial hubs.
- The Dam Raising Project (2004–present): A massive project to raise the dam’s height by 40 feet to combat siltation submerged an additional 15,780 acres. Decades later, a significant portion of the agreed-upon multi-billion rupee compensation and resettlement package remains gridlocked within the federal Ministry of Finance, triggering formal warnings from the Ministry of Defence regarding internal security risks.
4. Severe Infrastructure Ironies
While the water from the Jhelum River spins turbines that illuminate factories in Punjab and Sindh, the people of AJK face intense daily infrastructure failures. The region experiences prolonged rolling blackouts (load-shedding) lasting up to 10 hours a day, alongside severe local water scarcity in the very districts that border the massive reservoir.
For the protest movement, demanding electricity at production cost is not a request for charity. It is viewed as an inherent right of resource ownership—a logical compensation for the absolute sacrifice of their land, the environmental alteration of their rivers, and the historical displacement of their families.





