While touted as a “project of the century,” the Yarlung Zangbo Hydroelectric Project illustrates how megadams can reshape energy landscapes, displace communities, and test international water governance.
This is the 181st in the ‘China Chronicles’ series.
In July 2025, Chinese Premier Li Qiang announced the commencement of the Yarlung Zangbo Hydroelectric Project, describing it as the “project of the century”. This statement does not just encompass the scale of the Yarlung Zangbo project — which upon completion will be the largest of its kind — but also reflects China’s ambition and vision for the region. This megaproject offers a neat solution to the nation's growing energy demands while signalling China’s ascendancy in achieving carbon neutrality. Perhaps more critically, this undertaking allows China to maximise its hydro power potential at the cost of a cautious neighbour, India.
The Yarlung Zangbo project is expected to produce more than three times the output of the Three Gorges Dam, enough to match the annual energy needs of Great Britain single-handedly.
In 2006, when China unveiled the Three Gorges Dam, it was considered the biggest hydroelectric project of its time. Towering 200m in height and spanning almost 2km over the Yangtze River, this dam boasted a power-generating capacity of over 20,000 megawatts. At its peak, i.e, full load capacity, in 2021, this singular project contributed a little over 1 percent of the total energy produced by China that year. And yet, such figures pale in comparison to the latest venture of the Chinese government. The Yarlung Zangbo project is expected to produce more than three times the output of the Three Gorges Dam, enough to match the annual energy needs of Great Britain single-handedly.
Slated to be built on the lower reaches of the Yarlung Zangbo river, this project utilises the topography of the region, as the river descends 2000 meters in a span of 50 km. This dam will harness the tremendous hydroelectric potential of this region by connecting five cascade hydropower stations along this stretch. This project is expected to cost US$167 billion and has been envisioned to meet the rising domestic energy demands. The Chinese Foreign Ministry’s spokesperson, Guo Jiakun, further explained that such a construction is a paramount measure for disaster management across the flood-prone Yarlung basin, and for ushering in economic prosperity.
To this end, Chinese markets are already witnessing a surge in the valuation of associated companies. Groups such as the Power Construction Corporation of China, Hunan Wuxin Tunnel Intelligent Equipment Co, and Tibet GaoZheng Explosive Co — which are involved in the manufacturing of construction equipment, cement, and explosive materials, respectively — saw a jump in stock prices between 10 and 30 percent shortly after Premier Li Qiang’s announcement.
However, this project also spells worry for the delicate socio-ecological fabric of the region. Given the scale of this behemoth project, ecologists and NGOs have raised concerns over the expected displacement of local populations, disruption to ecosystem services, and damage to the environment. The proposed project cuts across the Yarlung Zangbo Grand Canyon, one of the richest, biodiverse regions that houses Asia’s tallest and oldest trees, many big cats and other predatory mammals. Furthermore, the project is located on a seismic hotspot, which paves the way for potential landslides and outburst floods owing to tectonic shocks. Assuaging such fears, the foreign ministry has claimed that the “all-round ecological conservation” of the region has been taken into consideration while developing this project.
Given the scale of this behemoth project, ecologists and NGOs have raised concerns over the expected displacement of local populations, disruption to ecosystem services, and damage to the environment.
Through its strategic positioning, this project affords China a tactical hold in southeastern Tibet — further consolidating its territorial prowess. It fortifies China’s access to the Asian Water Tower — a blessing in the face of rising water scarcity, and equips the upper riparian nations with punitive powers against the lower riparian nations, should the need arise. While Beijing remains resolute in its promise that this project will not result in any “negative impact” downstream, rivers do not flow in a vacuum, and the fear of the riparian nations of India and Bangladesh is palpable.
After exiting China, the Yarlung Zangbo is known as the Brahmaputra in India, as it flows through the states of Arunachal Pradesh and Assam, before entering Bangladesh, where it is known as the Jamuna. For India — a nation which has been water-stressed since 2011 — this project poses a two-pronged threat. First, ecologically, there is no telling the level of environmental variation the project can cause. Especially owing to its positioning over the tectonic fault lines, damage or dam failure could lead to devastating downstream floods.
Equally concerning is the zero-sum game calculation. China can, in theory, restrict or divert India’s water supply as it is not a party to any binding water agreement. The project is already being heralded as a “water bomb” in Indian political discourse, with the concern that a geopolitical standoff could spiral into an existential threat. Experts have, however, warned against falling for the “water war” rhetoric, considering that the water flows India draws from the Brahmaputra are derived from the monsoonal surge in the region rather than from glacial melt output. Further downstream, Dhaka is concerned about potentially reduced flows during the dry season. Their fears help explain how unilateral upstream constructions — such as the Yarlung Zangpo project — add to the ballooning insecurity in the region, whether that be ecological or cognitive.
Equally concerning is the zero-sum game calculation. China can, in theory, restrict or divert India’s water supply as it is not a party to any binding water agreement.
However, the tide is turning. Recent trends point towards a thawing of Sino-Indian relations, evident through the resumption of the Special Representatives meeting, and President Xi Jinping’s comments at the Shanghai Cooperation Organisation (SCO) summit, remarking on how it's time for the “Dragon and Elephant to come together”. Given the threats posed by climate change, this could be the perfect opportunity to centre non-traditional security threats in diplomatic negotiations. A first step would be to demand more information regarding the project, such as its storage capacity and operating procedures, to combat the ambiguity that currently shrouds it. In the longer run, India should also push more fervently for the sharing of year-round hydrology data that is updated in real time, outlining a code of conduct that monitors the riparian nations' interactions in the shared basin, and perhaps even conducting a joint impact assessment study, along with Bangladesh.
As the upstream power that controls the headworks of such a crucial river system, China may feel that it does not need to abide by any rules it cannot rewrite. Yet, the dragon would do well in recognising that leveraging this dam for short-term geopolitical gain goes fundamentally against long-term regional stability and sustainability of the shared basin. It is paramount that China is held to the same standards it demands of others, and if it is resolute in its position as a champion of carbon neutrality, then it must also answer for the ecological devastation and displacement of local Tibetan communities.
Roshani Jain is Coordinator, Forums at the Observer Research Foundation.
The views expressed above belong to the author(s). ORF research and analyses now available on Telegram! Click here to access our curated content — blogs, longforms and interviews.
Roshani Jain is a Coordinator— Forums. In this capacity she assists in organising various international convenings that are hosted by ORF. These conferences bring together global ...
Read More +
PREV
