Centre pays a pittance to Andhra Pradesh for Polavaram

Centre released a pittance of Rs 100 cr as reimbursement of the Rs 1800 cr that the Andhra spent on Polavaram project.

Published: 25th August 2016 09:31 PM  |   Last Updated: 25th August 2016 10:04 PM   |  A+A-

VIJAYAWADA: The Centre has so far released a pittance of Rs 100 crore as reimbursement of the Rs 1800 crore that the government of Andhra Pradesh spent so far on the Polavaram irrigation project.

Polavaram is a national project, which means that the Centre foots 90 per cent of the bill for it. The state spends the money and is reimbursed for it. The first phase of the project is to be completed by 2018. To meet that deadline, the state government would have to spend Rs 300 crore per month for excavation of the earth at the project site. How much of it will be reimbursed to the state is the million dollar question.

Chief minister Chandrabbau Naidu is understood to have expressed doubts on this question while making a real-time virtual inspection of the Polavaram site from his command and control centre at the Durga Ghat here on Thursday with the help of drones which sent back video footage of the work going on there.

According to sources, Chandrababu Naidu has on more than one occasion expressed his dissatisfaction with the Centre for asking the state government to borrow from Nabard for Polavaram for which it said it would stand guarantee and repay the loan. However, it has not been made clear to the state as to how much Nabard would give the state, when and on what terms.

The sources said that the Centre, while advising the state to borrow from Nabard, is insisting at the same time that the loan be within the ceiling fixed by the Fiscal Responsibility and Budget Management (FRBM) Act, which allows borrowing of no more than 3 percent of GSDP. Naidu has asked the Centre to raise the ceiling as a special case for Andhra Pradesh but there has been no response.

At the review on Thursday, Naidu is understood to have been informed that the state would have to spend up to Rs 3,000-4,000 crore this financial year for the project to take shape.

Naidu is understood to have said at the review meeting that the state government cannot allow the machinery stationed at the project site to remain idle since equipment suppliers have to be paid whether they are put to work or not. "We have so far done 2.5 crore cubic metres of earth work and approximately 6.47 crore cubic metres of work is pending. The work should go at a speed 2.5 lakh cubic metres per day if we have to reach the 2018 deadline," he is reported to have said.

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