By Athar Parvaiz

SRINIGAR, India (Thomson Reuters Foundation) - Mismanagement of a flagship land ownership scheme in India's northern Jammu and Kashmir state, banked on by the regional government to generate cash to build its own power plants, is holding back local ambitions for energy independence.

The Roshni (Light) scheme was originally expected to bring INR 250 billion ($3.73 billion) into state coffers, enabling the Kashmir authorities to avoid doing deals with India’s National Hydro-electric Power Corporation (NHPC).

But the region’s government revealed last month that only INR 780 million had been collected so far, amid accusations of corruption.

In response, irate members from all parties at a recent session of Kashmir’s legislative assembly forced the government to agree to order a thorough probe of irregularities laid out in a 2014 report by the Comptroller and Auditor General of India, who holds the rank of a Supreme Court judge.

In 2000, Kashmir’s National Conference government at the time conceived a scheme in which people who had illegally occupied government land would be given ownership rights to that land in return for payment of its market value.

Revenue from transferring ownership rights over 102,579 hectares (253,478 acres) of land was earmarked for construction of hydropower projects intended to generate huge state revenues from energy exports, as well as meeting Kashmir’s own energy requirements.

But in 2014, the Comptroller and Auditor General revealed the land transfer scheme had suffered irregularities, including the transfer of land at rates far below the market value and non-payment by many land occupants, including political leaders.

Since then, Kashmir’s corruption watchdog, the State Vigilance Organisation (SVO), has indicted 49 officials, including two top-ranking bureaucrats and dozens of revenue officials, on related charges.

Many members of the current assembly also accuse some politicians, including a former speaker and a few legislators, of acquiring land at dirt-cheap rates.

“Ministers in previous governments were also involved in the Roshni land scam,” Kavinder Gupta, speaker of Kashmir’s legislative assembly, told members.

TREATY IN HOT WATER

The Roshni scheme was intended to assuage Kashmiri anxiety over the 1960 World Bank-mediated Indus Waters Treaty (IWT) between India and Pakistan, which many feel disregarded Kashmir’s economic interests.

That treaty allowed India and Pakistan to share the Indus River and its five tributaries – the Jhelum, Chenab, Ravi, Beas and Sutlej – and provided mechanisms for settling disputes.

Under the treaty, Pakistan received exclusive use of the waters from the Indus and its west-flowing tributaries, the Jhelum and Chenab, while the Ravi, Beas and Sutlej rivers were allocated for India's use.

The treaty also stated that upper riparian India could build run-of-the-river projects only on the Indus, Chenab and Jhelum, which flow through Kashmir. The NHPC has constructed seven power projects in the region and plans more in the future.

The NHPC, which generates over 2,000 MW of hydropower in Kashmir, gives just 12 percent of the electricity it produces there to the state government, evoking strong local criticism.

As of now, the state itself generates only 761 MW, given its lack of resources to exploit the region’s hydro-electric potential, against peak demand of 2,600 MW.

In 2002, Kashmir’s legislative assembly passed a resolution seeking the termination of the Indus treaty on the basis that Kashmiris were not consulted when India and Pakistan signed it. Ever since, the treaty and the NHPC’s operations in Kashmir have been a topic of hot debate.

Sensing the mood, a committee formed by then Indian Prime Minister Manmohan Singh suggested in a 2007 report that the NHPC should transfer at least two power projects to Kashmir, but that has yet to happen.

In 2009, National Conference leader Nazir Gurezi, speaking in Kashmir’s legislative assembly, called the treaty “a sign of slavery” for Kashmiris.

And two years later, Taj Mohi-ud-Din, Kashmiri leader for the Indian National Congress and then irrigation minister, drew an analogy between the NHPC in Kashmir and Britain’s erstwhile East India Company, a comparison that has come to symbolize Kashmiri resentment over the use of its water resources.

LOCAL DEVELOPMENT

Zahoor Ahmad Chat, former executive director of projects at the State Power Development Corporation, told the Thomson Reuters Foundation that if the Kashmir government could muster the resources to harness the region’s energy potential of around 15,000 MW, it would provide economic stability and spur development.

Chat said exploiting projected surplus power could earn the region annual revenue of some INR 150 billion, and make the most of Kashmir’s renewable energy sources for its people.

“We have the luxury of having clean over-ground energy resources like water - one of the most preferred energy resources in the age of climate change,” he said.

“Even if a small percentage of the expected (Roshni scheme) revenue was realized, we would be able to create small power projects in all of our rural areas.”

($1 = 67.0650 Indian rupees)

(Reporting by Athar Parvaiz; editing by Megan Rowling; Please credit the Thomson Reuters Foundation, the charitable arm of Thomson Reuters, that covers humanitarian news, women's rights, trafficking, corruption and climate change. Visit http://news.trust.org)