Polavaram Project in Andhra Pradesh to get Rs 2,000 crore from Centre

While the state had sought Rs 10,000 crore to meet the project deadline, the interim funding will come in handy for the cash-strapped state.
A view of the Polavaram project right main canal in West Godavari district I P Ravindra Babu
A view of the Polavaram project right main canal in West Godavari district I P Ravindra Babu

VIJAYAWADA: In what could give a breather to the cash-strapped State government, the Ministry of Water Resources has agreed to release Rs 2,000 crore as interim funding for the execution of the Polavaram Irrigation Project (PIP). The State government had sought release of Rs 10,000 crore as the final clearance for the Revised Cost Estimates (RCE), which is essential for the release of the approved funds, is expected to take some more time.

Even though the Technical Advisory Committee (TAC) of the Central Water Commission (CWC) cleared the RCE of Rs 55,548 crore of the project in February, it is yet to get the financial concurrence.

The State government has already spent close to Rs 4,550 crore over and above the approved costs (as per old detailed project report), and has been waiting for reimbursement. At this juncture, the State Water Resources Department had sought release of Rs 10,000 crore to expedite the ongoing project works.

“The Ministry of Water Resources has sent a file to the Ministry of Finance seeking release of Rs 2,000 crore for Polavaram Irrigation Project about 15 days ago. We are expecting that these funds will be released soon,” Secretary of State Water Resources Department Shashi Bhushan Kumar told TNIE.

The release of funds has become crucial as the State government is working with a deadline of July to release the Polavaram water by gravity into the canals. Unless a continuous flow of funds is available, it is unlikely that the officials can meet the target as several components of the project, including rehabilitation and resettlement (R and R) and civil construction, remain pending.

Sources in the Water Resources Department said that even though the interim funding would not solve the entire problem, it was definitely a relief considering the grim financial position of the State government. According to information, besides the Rs 4,550 crore, which is yet to be reimbursed by the Centre, the State has put on hold payments to be made to the contractors working on the national project. For the record, the State government is spending for the construction of the national project, which is being reimbursed by the Centre.

“Bills worth Rs 300 crore are pending with the State government as its financial situation is bad. Keeping this in mind, we asked Rs 1,000 crore - Rs 4,850 crore towards reimbursement and the remaining as interim funding till the RCE is cleared. But, the Union ministry recommended release of Rs 2,000 crore, which would help us a bit, if not provide a relief,” a senior official explained.

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