USAID’s Top 10 Failures – No. 10: The Gomal Zam Dam Failure

Introduction: A $114 Million Money Pit That’s Already Falling Apart

The Gomal Zam Dam was supposed to be a modern engineering marvel, bringing hydropower and irrigation to a remote region of Pakistan. Instead, it’s already failing.

• The hydropower system lasted less than three years before a catastrophic turbine failure.
• Sediment buildup is already reducing the dam’s lifespan decades ahead of schedule.
• The irrigation network USAID funded doesn’t deliver water where it’s needed.

USAID spent millions on infrastructure that was fundamentally broken from day one. The dam was never built to last, and no one planned for long-term maintenance. Instead of delivering sustainable energy and irrigation, USAID built a ticking time bomb of structural and operational failures.

The 2016 Hydropower Failure: When $40 Million Buys You Three Years of Electricity

The Gomal Zam Dam was supposed to generate 17.4 MW of electricity, enough to power thousands of homes. But by October 2016, just three years after going online, the turbines experienced a catastrophic failure.

Why did the power system fail so quickly?

• Cheap protection systems: The hydropower plant’s electrical protection system failed, damaging both turbines beyond repair.
• No backup plan: There was no redundancy in the system—once the turbines failed, the dam was completely offline.
• No long-term maintenance strategy: USAID funded the dam’s completion but had no plan for long-term repairs or replacements.

By the time repairs were considered, the cost of fixing the turbines was almost as much as the cost of building the power plant in the first place. In short, the dam’s hydropower component was already dead in the water before it even had a chance to prove useful.

Sedimentation: The Dam is Already Filling with Mud

One of the biggest engineering failures of the Gomal Zam Dam was sediment management.

What’s happening?

• The Gomal River carries a high sediment load, meaning large amounts of mud, silt, and debris get deposited in the dam’s reservoir.
• Sediment accumulation reduces the dam’s water storage capacity, making it less effective for both irrigation and flood control.
• Poor watershed management—deforestation, overgrazing, and soil erosion in the surrounding areas have accelerated the rate of sedimentation.

The long-term problem?

• The dam was supposed to last decades—but sediment buildup is already cutting its lifespan short.
• Water storage capacity is declining faster than expected, meaning less water for irrigation and higher risks of overflow during floods.
• Without dredging or proper sediment management, the dam could become practically useless in a fraction of its intended lifespan.

USAID funded the completion of a dam that is already failing its most basic function—storing and regulating water.

The Canals That Don’t Work: A $40 Million Irrigation Scam

USAID’s biggest investment in Gomal Zam wasn’t the dam itself—it was the irrigation network. Between 2011 and 2015, USAID dumped $74.22 million into a system that was supposed to deliver water to over 191,000 acres of farmland.

The result?

• The main canals were built—but the secondary and tertiary canals weren’t completed properly.
• Many farmers never received the water they were promised.
• Corruption and mismanagement led to water theft and bribery schemes.

What went wrong?

1. Poor Planning – The primary canal was constructed, but the network that distributes water to individual farms was never fully operational.
2. Water Theft – Powerful landowners and officials hijacked water flow, directing it to politically connected farms while smaller farmers got nothing.
3. Technical Failures – Water failed to reach intended areas due to poor maintenance, clogged canals, and sedimentation.

USAID invested millions in an irrigation system that only works for the elite, leaving the small farmers—the supposed beneficiaries—high and dry.

The Waran Canal Disaster: A Separate $12 Million Failure

USAID also spent $12 million on the Waran Canal, a 164-kilometer-long irrigation channel intended to bring an additional 28,000 acres under permanent irrigation.

Why did it fail?

• The canal exists, but water flow is inconsistent—some sections work, others are completely dry.
• Poor construction led to frequent blockages, collapses, and breaches.
• Farmers have to bribe officials to get access to water.

Like the main irrigation network, the Waran Canal is a perfect example of how USAID funds infrastructure that barely functions.

A Lack of Accountability: No One is Fixing the Problems

One of the biggest failures of the Gomal Zam Dam project is the complete lack of post-construction oversight.

• Once USAID’s money was spent, no one was held accountable for maintenance or performance.
• The Pakistani government has no long-term financial plan for the dam’s upkeep.
• The irrigation canals and power plant continue to degrade without serious intervention.

Without ongoing investment in repairs and sediment management, the dam will only continue to decline.

Conclusion: A Dam That’s Dying Faster Than Expected

The Gomal Zam Dam was supposed to be a long-term investment in Pakistan’s energy and water security. Instead, it has turned into a rapidly deteriorating liability.

• The hydropower system failed in three years.
• Sediment is choking the reservoir far earlier than expected.
• The irrigation canals USAID funded are unreliable, mismanaged, and corrupt.
• No one is maintaining the infrastructure, meaning it will only get worse.

USAID didn’t just fund a dam—it funded a slow-motion collapse of an entire regional development strategy. The U.S. government poured $114 million into a project that was doomed from the start, and now, just a few years later, it’s already breaking apart.

5. The Financial Black Hole: Where Did the Money Go?

Introduction: When $114 Million Disappears Into the Bureaucratic Abyss

The Gomal Zam Dam wasn’t just an engineering disaster or a Taliban stronghold—it was a financial black hole. USAID poured $114 million into this project, but no one seems to know exactly where all the money went.

• The dam’s construction suffered massive cost overruns.
• Millions in “questioned costs” surfaced in financial audits.
• Pakistani government agencies funneled USAID money into inflated contracts, corrupt procurement deals, and non-existent maintenance.
• USAID’s oversight was so weak that large portions of funding vanished with little accountability.

This isn’t just a development failure—it’s a classic USAID scam, where American taxpayer dollars disappear into a sea of bureaucratic mismanagement, shady contractors, and security expenses that did nothing to secure the project.

How a $75 Million Project Became a $220 Million Boondoggle

The Original Cost Estimates (1963-2002)

When first approved in 1963, the Gomal Zam Dam was expected to cost $25 million. By the time construction resumed in 2002, the estimate had ballooned to $75 million—but that was just the beginning.

The 2011 USAID Bailout: $40 Million Spent, No Questions Asked

In 2011, USAID injected $40 million into the dam’s final phase, with zero enforcement of financial accountability.

Where did the money go?

• Unverified contractor payments—millions spent without proper documentation.
• Security costs that failed to prevent kidnappings, extortion, or attacks.
• Administrative fees and overhead that ballooned far beyond expected costs.

The result? The dam was finished, but it barely functioned, and major technical failures began almost immediately.

The Second Round of USAID Investment: $74.22 Million for Canals That Don’t Work

After wasting $40 million on a defective dam, USAID then spent another $74.22 million between 2011 and 2015 on irrigation infrastructure. This included:

• $40 million for irrigation canals that failed to distribute water properly.
• $12 million for the Waran Canal, which suffered from poor construction and inconsistent water flow.
• $22.22 million for the Command Area Development Project, which was supposed to train farmers and improve agricultural productivity—but failed due to corruption and inefficiency.

The Real Financial Disaster: What USAID’s Audits Found

In 2018, USAID’s Office of Inspector General (OIG) conducted an audit of the Gomal Zam Dam project. The findings?

• Millions in “questioned costs”—funds that were either misused, unaccounted for, or fraudulently reported.
• $358,627 in direct questioned costs, including inflated contractor invoices and unapproved security expenses.
• Procurement irregularities—equipment purchases that were either unnecessary or never properly documented.
• No long-term sustainability plan, meaning that USAID-funded infrastructure was left to deteriorate immediately after construction.

The Pakistani Government’s Role in the Corruption

One of the biggest failures in USAID’s financial oversight was trusting Pakistan’s Water and Power Development Authority (WAPDA) to handle project funds.

• WAPDA awarded contracts to politically connected firms with little accountability.
• Millions in USAID funding flowed through layers of middlemen, inflating costs and reducing real spending on infrastructure.
• Equipment was purchased at significantly marked-up prices, with little verification of quality or necessity.

Instead of providing rigorous oversight, USAID just kept the money flowing, hoping that the project would eventually work itself out.

Where Did the Money Actually Go?

Of the $114 million USAID invested, how much actually went to functional infrastructure? The answer: no one knows.

• Contractors were overpaid for work that was either defective or incomplete.
• Security expenses ballooned but did nothing to protect workers from kidnappings or attacks.
• Maintenance funding was virtually non-existent, ensuring the project would fall apart almost immediately.
• Farmers never got the irrigation they were promised, meaning that millions spent on water distribution networks produced no real agricultural benefits.

USAID’s Signature Move: Declare “Success” and Walk Away

Despite the dam’s power plant failing in 2016, irrigation canals underperforming, and financial irregularities piling up, USAID still declared the project a success.

Why? Because USAID doesn’t measure success in real-world impact—it measures success in spending.

• As long as the money is spent, the project is “completed.”
• As long as ribbon-cutting ceremonies happen, USAID considers it a “win.”
• The fact that the dam is already deteriorating and the irrigation network doesn’t work is irrelevant to USAID’s internal metrics.

Conclusion: The Perfect Case Study in How USAID Burns Cash

The Gomal Zam Dam was never about real development—it was a bureaucratic exercise in moving money.

• The dam cost way more than originally planned, yet still failed within years of completion.
• The irrigation system USAID spent millions on doesn’t function as promised.
• Massive amounts of money were lost to corruption, waste, and inefficiency.
• USAID walked away, calling it a success, while the project fell apart.

The Gomal Zam Dam isn’t just a foreign aid failure—it’s a masterclass in how USAID wastes U.S. taxpayer dollars while pretending to build sustainable infrastructure.

6. Final Verdict: USAID’s Death Under Trump 2.0 and the Lessons Ignored

Introduction: USAID Is Dead—But Its Failures Live On

As of February 2025, USAID no longer exists as an independent agency. Trump’s second administration eliminated it outright, folding its responsibilities under the State Department’s Bureau of Economic and Business Affairs. The move was less about cutting corruption and more about dismantling U.S. foreign aid entirely—but the irony is, USAID had been failing for decades, and projects like Gomal Zam prove exactly why no one fought to save it.

This marks the first entry in our top 10 list of USAID’s worst disasters, and it’s a perfect starting point:

• $114 million spent, with nothing to show for it.
• A hydropower system that failed within three years.
• An irrigation network that never worked.
• A Taliban stronghold that benefited more from the dam than local farmers.
• And millions lost to fraud, waste, and incompetence.

Trump’s gutting of USAID wasn’t about fixing these failures—it was a blunt-force political decision. The real lesson of Gomal Zam isn’t just that USAID deserved to die—it’s that the foreign aid machine that replaces it will be just as bad.

Lesson #1: USAID Deserved to Be Dismantled—But for the Right Reasons

Let’s be clear: USAID was an operational disaster. It was a spending machine that valued optics over outcomes.

• Infrastructure projects were declared “successful” as long as the money was spent.
• Oversight was weak, allowing fraud and corruption to flourish.
• Security risks were ignored, meaning U.S. funds frequently ended up in the hands of insurgents.

The Gomal Zam Dam was a perfect case study in how USAID wasted taxpayer dollars with zero accountability. And it was far from the worst of its failures.

But Trump Didn’t Kill It for the Right Reasons

Instead of replacing USAID with a better model, Trump’s second-term strategy was simple: burn it to the ground.

• Development budgets were slashed, not reformed.
• Transparency wasn’t increased—funding just got buried deeper in the State Department bureaucracy.
• Corrupt contractors weren’t held accountable—they just lost their usual U.S. government clients.

USAID needed a serious overhaul, but what it got was political theatrics. The problems didn’t disappear—they just changed hands.

Lesson #2: The Money Will Keep Flowing, Just Through a Different Pipe

With USAID gone, all major foreign aid projects are now under direct control of the State Department. The problem?

• State was never designed to oversee infrastructure projects.
• Diplomatic staff are now managing aid budgets they barely understand.
• Transparency has gotten even worse—Congressional oversight is weaker than ever.

And here’s the real kicker: the same waste and fraud that plagued USAID is still happening—it’s just harder to track.

Gomal Zam Proves the Pattern Will Continue

The real lesson of Gomal Zam isn’t just that USAID mismanaged it—it’s that the U.S. government fundamentally doesn’t know how to run large-scale infrastructure projects in unstable countries.

• They don’t vet contractors properly.
• They don’t secure projects before investing in them.
• They don’t enforce maintenance and long-term sustainability.
• They measure success in money spent, not impact achieved.

USAID is dead, but this model of failure is very much alive.

Lesson #3: U.S. Foreign Aid Was Broken Before USAID Died, and It’s Still Broken Now

Trump’s administration justified killing USAID by pointing to projects like Gomal Zam—and honestly? Fair enough.

But did they fix anything? No.

• State is still funding infrastructure in unstable regions.
• There’s still no accountability for how money is spent.
• Corruption in foreign aid is worse than ever—just less visible.

Instead of a reformed USAID focused on real impact, we now have a State Department that’s even less equipped to manage these projects.

Lesson #4: The Taliban Still Wins, No Matter Who’s in Charge

The Gomal Zam Dam was a Taliban payday.

• They extorted contractors.
• They kidnapped workers and ransomed them back.
• They controlled access to irrigation and used it as a tool for local governance.

USAID’s failure to secure the project meant that American tax dollars ended up funding insurgents.

And now? That lesson is still being ignored.

• The State Department is still funding major infrastructure projects in conflict zones.
• Aid money is still being siphoned by militant groups through protection rackets.
• No one in Washington is seriously questioning why these projects keep failing.

The next Gomal Zam is already being built somewhere—funded by a U.S. government that still hasn’t learned its lesson.

Final Verdict: Gomal Zam Deserves Its Place in the USAID Hall of Shame

This is just #10 on our list of USAID’s worst disasters—but it’s a perfect entry point into the agency’s long history of failure.

• A $114 million dam that fell apart within three years.
• An irrigation system that never worked.
• Millions lost to fraud and corruption.
• A Taliban stronghold built with U.S. funds.

USAID deserved to be dismantled, but not like this. Instead of fixing what was broken, Trump’s administration just buried the agency while keeping the same wasteful spending model alive.

And that means the next Gomal Zam is already in the works—funded by the same dysfunctional system, with the same doomed outcome.

USAID may be gone, but its legacy of failure lives on.