China has approved the construction of the world's largest dam on the Yarlung Zangbo river – known in India as the Brahmaputra – in Tibet close to the Indian border, Chinese state-run Xinhua news agency reported on Wednesday.

First announced in 2020, the project is touted to be the world’s most expensive infrastructure project with a cost $137 billion. It is unclear when the project’s construction is due to begin.

The dam is planned to be built across a vast gorge in the Himalayas where the Brahmaputra makes a U-turn before entering India through Arunachal Pradesh. The river then flows into Bangladesh before joining the Bay of Bengal.

The project is estimated to produce 300 billion kilowatt-hours of electricity annually – more than three times the capacity of the world’s current biggest hydropower plant, which is also in China, according to the South China Morning Post.

China has planned to install nearly twice the amount of solar and wind energy production capacity as the rest of the world combined, according to a report by Global Energy Monitor in November. The Brahmaputra dam project would help Beijing make significant progress towards its carbon neutrality goals.

However, there are concerns in India and Bangladesh over the project. Critics say it could potentially alter local ecologies and change the flow and course of the river, affecting millions living in the agricultural plains downstream, according to The Indian Express.

PTI reported that the dam could also enable Beijing to release vast amounts of water and flood border areas during times of conflict.

A meeting between India’s National Security Advisor Ajit Doval and Chinese Foreign Minister Wang Yi on December 18 had yielded “positive” discussions about the sharing of data on trans-border rivers.