The Ministry of Environment and Forests (MoEF) expert committee has decided to wait until the environment impact assessment study is completed.
A MoEF official said that the study is yet to start and is expected to take at least two years for completion.
The official told The Indian Express: "The MoEF had issued terms of reference for the Dibang basin study in November, 2013, to the Central Water Commission, but study is yet to commence as the process of awarding study is still underway."
The INR250bn ($3.98bn) Dibang river basin project is a run-of-the-river facility planned to be built on Dri and Tangon rivers in Dibang Valley.
The official said: Livemint? cited the committee as saying in its decision: "Etalin HEP is one of the many HEPs in the Dibang river basin.
"As per the policy adopted by the Government of India, one project in the river basin can be approved without insisting on the Cumulative Environment Impact Assessment Study (river basin study). Dibang HEP has already been recommended by the FAC for the approval."
Last year, the MoEF cleared the hydro power project, despite being rejected twice during the previous regime of United Progressive Alliance government.
The FAC said in its recommendation to Environment Minister Prakash Javadekar: "After detailed discussion, the FAC recommended that the proposal will be considered after completion of the Cumulative Environment Impact Assessment Study (river basin study) and its acceptance by the ministry."
