China has officially commenced construction of what is set to become the world’s largest hydropower dam on the lower Yarlung Tsangpo River in Tibet. The groundbreaking ceremony was held on July 19, 2025, in Nyingchi, and presided over by Premier Li Qiang, who declared it the “project of the century”.
Covering a staggering estimated cost of 1.2 trillion yuan (approximately USD 168 billion), the hydropower system will comprise five cascade stations across a 50-kilometer stretch, where the river plunges nearly 2,000 meters. Once operational—expected in the 2030s—it is projected to generate around 300 billion kilowatt-hours annually, roughly three times the output of China’s Three Gorges Dam—and equivalent to the entire electricity consumption of the UK in a year.
The hydropower dam project is overseen by a newly established state‑owned enterprise, China Yajiang Group, founded on the very day construction began. The initiative aligns with China’s broader push toward renewable energy and its 2060 carbon‑neutrality goal, while also aiming to stimulate economic development in Tibet through local employment and infrastructure activity.
However, the megaproject has sparked widespread criticism and concern among environmentalists, human rights advocates, and downstream nations—particularly India and Bangladesh. The Yarlung Tsangpo becomes the Brahmaputra in India and the Jamuna in Bangladesh, nourishing agriculture, drinking water, and livelihoods for millions across these nations.
Indian officials have formally raised concerns, urging China to ensure that activities in the upper reaches do not harm downstream states. In January 2025, India’s External Affairs Ministry declared it would “monitor and take necessary measures to protect our interests.” The northeast Indian state of Arunachal Pradesh—located just 50 km south of the dam site—has voiced particular alarm; local leaders have warned that the dam could potentially “dry out” up to 80% of the river’s flow downstream.
Critics also emphasize the fragile and seismically active nature of the Tibetan Plateau. The dam’s construction involves drilling multiple 20‑km tunnels through the Namcha Barwa mountain massif, raising serious landslide and earthquake risks in one of Earth’s most unstable canyon environments.
Environmental experts warn of consequences including disrupted sediment flows (essential for agriculture downstream), altered ecological regimes, and threats to local biodiversity on the plateau—a region home to some of Asia’s richest wildlife. Tibetan communities and activists have also highlighted the project’s potential to displace people and damage sacred cultural sites, though no official estimates of displacement have yet been released. Comparatively, the Three Gorges Dam resettled about 1.4 million people, while Tibet’s lower population density suggests fewer—but still significant—relocations.
China has pushed back against fears of “water hegemony,” insisting the design is mainly “run‑of‑river” and will not substantially divert water flows. The government has pledged to maintain communication channels with downstream neighbors and to prioritize ecological conservation in project implementation.
Financial markets in mainland China reacted positively to the launch, especially firms in the construction, engineering, and materials sectors, seeing the project as an injection of stimulus reminiscent of China’s past infrastructure-driven growth cycles.
As China embarks on this unprecedented endeavor, the challenge of balancing massive energy infrastructure with regional water diplomacy, ecological integrity, and geopolitical trust looms large. The world will be watching whether downstream nations can negotiate meaningful frameworks—or whether the dam becomes a flashpoint in Asia’s water politics.
