Poor Compensation and Resettlement. In the light of poor and inadequate compensation for project affected persons in the past, hydropower projects can effectively become a vehicle to transfer wealth from the affected rural poor to project beneficiaries. Government institutions which have been entrusted with the job of providing compensation to the project affected have, to date, not done an adequate job even in fulfilling the laws of the land which say that due compensation should be provided to losers. The commitment and priority this sector would need in order to transform project affected people to project beneficiaries is nowhere in sight. Unclear Local Benefits.
Local people expect substantive benefits when a hydropower project is constructed in their locality.
However, the nature of this industry is such that few benefits actually accrue automatically to local people. Skilled construction jobs go mostly to outsiders with even the labourers sometimes brought in from the outside by the contractor. Traders who come in to the area to take advantage of the economic boom are also mostly outsiders. The limited menial jobs, which are available to locals, last only a few years. The boom and bust cycle of dam construction is similar to that of an extractive or mining industry.