Islamabad: Pakistani Prime Minister Yousuf Raza Gilani on Tuesday laid the foundation stone of a 4,500 MW hydro-electric dam project in the country's picturesque Gilgit-Baltistan region.

The Diamir-Bhasha dam project on the Indus River will cost USD 12 billion, a news agency reported.

Gilani termed it a historic day and said the project would help mitigate the country's power crisis, as well as provide water for irrigation.

He praised the political parties for backing the mega project, and the local people who had to sacrifice their ancestral lands 'for a great national cause'.

Defence Minister Ahmed Mukhtar, Gilgit-Baltistan Governor Pir Karam Ali Shah and Chief Minister Mehdi Shah, among others, have attended the foundation laying ceremony.