Arunachal Pradesh Chief Minister Pema Khandu on Tuesday, 6 October declared hydropower the state's single largest opportunity for large-scale investment, citing roughly 19,000 MW of projects currently at various stages of development. Speaking at an official function in Itanagar, Khandu outlined both the financial framework underpinning these projects and the government's cautious, process-bound approach to the contentious Siang Upper Multipurpose Project (SUMP).

Financial Framework for Hydropower Development

Khandu confirmed that Arunachal Pradesh would continue to receive a 12 per cent free-power share from hydropower projects developed in the state. Beyond that, the Government of India has agreed to facilitate a 26 per cent equity share for the state in these projects — a significant revenue and ownership stake. The Chief Minister noted that the state's equity contribution across the 19,000 MW pipeline could amount to approximately ₹15,000 crore, which the Centre has agreed to support financially.

He pointed to the Lower Subansiri project, with an installed capacity of 2,000 MW, as a near-term milestone. The project is expected to be fully commissioned next year, after which it will begin delivering both free-power allocations and equity-linked returns to the state exchequer.

State Budget Growth as Economic Context

Khandu placed the hydropower push within a broader economic trajectory, noting that Arunachal Pradesh's state budget had grown from approximately ₹12,500 crore in 2015 to nearly ₹40,000 crore at present — more than a threefold increase in roughly a decade. He argued that expanding investment and building state-owned resource revenues through hydropower would further reinforce this fiscal momentum and reduce dependence on central transfers.

SUMP: Process First, Decision Later

On the Siang Upper Multipurpose Project, Khandu was emphatic that no final construction decision would precede the mandated technical and legal processes. The immediate requirement, he said, is completion of the Preliminary Feasibility Report (PFR). Following that, a full suite of assessments — including a Social Impact Assessment (SIA) and an Environmental Impact Assessment (EIA) — would be conducted in accordance with law.

Notably, Khandu reframed the project's primary purpose, stating it should not currently be viewed merely as a hydropower initiative. Its principal rationale, according to him, is the creation of a mechanism to manage potential water-related risks and regulate downstream water flows — particularly given documented concerns about sudden upstream water releases and recurring floods in the Siang belt.

'Until and unless we are satisfied, this project cannot go ahead,' Khandu said, underlining the need for informed public participation rather than what he characterised as misinformation circulating around the project.

Transparency and Community Consultation Commitments

The Chief Minister said state government offices would remain open to delegations seeking discussions on SUMP and invited representatives to make formal presentations and seek clarifications. He also announced that the government would endeavour to disseminate project information in the Adi language through social media channels — a step aimed at reaching communities in areas most likely to be affected.

Khandu also underscored SUMP's national and strategic dimension, noting that Arunachal Pradesh's position along international borders gives the project implications that extend well beyond the state. Technical experts, he said, must examine all hydrological, environmental, and social concerns during the feasibility and subsequent assessment stages. With the PFR still pending, the earliest formal milestones on SUMP remain months away.