The Dibang Multipurpose Project (DMP) in the state's Lower Dibang Valley, was put on hold for six years as the project required diversion of forestland and could displace hundreds of families in 39 villages in Dibang district.

Assigned to National Hydro Power Corporation Limited (NHPCL), the project was launched in 2008 by then Prime Minister Manmohan Singh. It envisages the construction of two dams over two tributaries of Dibang river: Dir and Tangon. Upon completion, the entire project will stand 278 metres tall, supposedly the largest in India and the largest concrete gravity dam in the world.

Several public hearings, scheduled between 2008 and 2013, were abandoned due to protests by people who would be displaced by the project. Besides the submergence of their rice fields and the loss of land in use, around 3.5 lakh trees would have to be felled for the project. The residents allege that the official number of families and people to be affected claimed by the government is much lower than the actual number of people who will be displaced. The compliance to the settlement of the rights of the tribal population, a must for such projects as per the Forest Rights Act, 2006, was also reportedly ignored by the state. 

Villagers took to the streets in 2011 to protest against the construction of the dam, and the government deployed paramilitary troops to suppress the protests. The people reportedly agreed to the project after two hearings towards the end of 2013. According to a media report, they were coerced into giving their consent to the project.

The project had been denied forest clearance twice in 2013 and 2014 due to discrepancies in its Environment Impact Assessment reports and the potential loss of biodiversity. However, it received environmental clearance from the Ministry of Environment, Forests and Climate Change in February 2015, and on November 13, 2018, the National Green Tribunal upheld it.

In March 2019, prior to the Assembly elections, the state government announced a compensation package to the affected people under Section 11 of the Land Acquisition Act, 1894. However, soon after the elections, a petition was filed by NHPCL claiming that 1,732.45 acres of land are unclassified and do not belong to any individual, leading to the Gauhati High Court staying the state government's compensation order. This nudged the locals to file a counter-petition claiming that NHPCL was trying to reduce the scope of the issue from the Land Settlement Act, 2015, to the Forest Conservation Act, 1980, which does not have any provision for compensating the affected people. The Dibang Multipurpose Project Affected Area Committee has demanded that all project work be stopped until the high court settles the matter.

On July 18, 2019, the Cabinet Committee on Economic Affairs (CCEA), chaired by Prime Minister Narendra Modi, gave the project the go-ahead and stated that the project completion would take nine years, despite it not having received Stage II forest clearance and the compensation issue not being settled. The CCEA also approved the proposal of the Dam Safety Bill 2019 and assured that a National Committee on Dam Safety will be instituted to develop policies and recommend regulations.

In February 2020, the Forest Advisory committee (FAC; an advisory body of the environment ministry tasked with deciding whether forestland can be diverted for industrial projects) conducted an on-site visit to the project area. In a subsequent meeting on April 23, the FAC accepted the controversial findings of the Wildlife Institute of India study, titled “Wildlife Conservation Plan for Impact Zone of Etalin HEP”, and sought recommendations from the Ministry of Power on whether to continue the project or not. Following the study, there was outcry from activists and experts alike over the impact of the project on the biodiversity of Dibang valley.

On January 17, 2022, the Dibang Valley District Students's Union and the All Idu Mishmi Students Union enforced an indefinite bandh in Dibang Valley protesting against the district administration for a delay in the disbursement of compensation.

In February 2022, the Dibang Multipurpose Project Affected Area Committee alleged that the district administration has put on hold the disbursement of compensation to 300 project-affected families without offering an explanation.

The decision on the project, which has already been deferred for six years, has been put on hold until the Ministry of Power clarifies about the changes, if any, made in its policy since 2014 when the project was last revised.

In June 2022, the Idu Mishmi community designated 70 square kilometers of their ancestral land as a Community Conserved Area to protect it from deforestation and large hydroelectric projects. The Indian government approved the construction of a $3.9 billion hydropower project in the same area in February 2023. Concerns have been raised about the environmental and social impacts of the project, and there are calls for a comprehensive downstream impact assessment.

Abba Pulu, one of the members of EECEP, who is also an assistant professor of Geography at the Indira Gandhi Government College in the state said, “Community members feel that they need to protect their land because of these huge infrastructural developments, which will affect our community land and animals in various ways.”

Meanwhile, concerns have also been raised over the impact of the dam in neighbouring Assam. “In the case of Dibang Valley, the Dibang Multipurpose Project is very large, which can have impacts up to Guwahati and that is why the assessments may have started at the Assam border. The study should have assessed impacts between the dam and the Assam border, and it is not enough to look at peaking flows or environmental flows," said Himanshu Thakkar, coordinator, of South Asia Network on Dams, Rivers and People (SANDRP).

According to the Dibang Multipurpose Hydro Project Downstream Affected Area Committee (DMHPDSAAC) Chairman, Gotem Tayeng, villagers in the downstream area fear that the project will cause extensive damage to the local flora and fauna, as well as their livelihoods. The committee has requested that the authorities conduct a cumulative downstream impact assessment of multiple projects in the Dibang basin to understand the potential harm that could be caused.

Additionally, the project is situated in a highly seismic zone. Earthquakes in the region have been “catastrophic,” warns geographer Chintan Sheth.

According to media reports, proponents of the DMP, including ministers and officials in New Delhi and Arunachal Pradesh as well as India’s powerful big dam lobby, systematically chipped at the resistance to the project. The consent of tribal protestors was “manufactured” by terrorizing them, branding them as ‘Maoist’ and breaking their resistance.

The government has steamrolled objections and issues of concern raised by activists and experts to give the DMP the green signal.