India to go ahead with Baglihar dam

Pak says the dam on Chenab would affect the flow of water to that country.

India on Monday made it clear that it would go ahead with the controversial Baglihar dam project in Jammu and Kashmir that Pakistan has taken to the World Bank for arbitration.

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Presenting the 2005-06 national budget in the Lok Sabha, Finance Minister P Chidambaram said the government would provide Rs. 3 billion ($70 million) for the dam during the year and adequate funds would be provided for next year too.

Pakistan wants India to stop construction of the dam on the Chenab river on the ground that it would affect the flow of water to that country.

Asserting that India has violated the bilateral Indus Water Treaty by building the dam, Pakistan has taken the matter for arbitration to the World Bank, which had brokered the 1960 pact.