VIJAYAWADA: Though the Union Ministry of Finance is expected to release the funds through NABARD for the next trance of Rs 2,234.87 crore reimbursement of Polavaram Irrigation Project (PIP) shortly, the State government is pushing for a revolving fund, considering the delayed release from the Centre. Ever since the PIP was declared a national project in 2014, the reimbursement was done on six instances, only once per every financial year.
According to officials, Rs 18,000 crore is required before the end of the current fiscal, that is in the next five-six months, to complete the first phase of the project as targeted by December 2021. As there is a three-layered hierarchy for the clearance of bills — State government to Polavaram Project Authority (PPA), PPA to Ministry of Jal Shakti (MoJS) and MoJS to Ministry of Finance — there is a delay of six to 12 months by the time the State submits the bills and funds reach its kitty. The funds are also released in a four-tier setup: Finance ministry raises money to NABARD, NABARD sends it to National Water Development Agency (NWDA), NWDA to PPA, and PPA to the State exchequer.
To bring down this gap, the State has repeatedly requested the MoJS to arrange a revolving fund. So far, the State received about Rs 8,507.26 as reimbursement since June 2014, while the Centre, in its reply in Parliament, maintained that Rs 8,614.7 crore has been reimbursed. The difference is said to be used by the PPA.
“We need Rs 8,000 crore for headworks, left main canal and right main canal works, and another Rs 10,000 crore for the land acquisition, rehabilitation and resettlement (LARR). A periodical flow of funds from the Centre is critical for the project completion. In the initial years, there were issues in the progress of works and the reimbursements were slow. But now, things have fallen in place and the works are progressing well. Yet, the delay in reimbursement continues. This circuitous and complicated process has an adverse impact on the finances of the revenue-deficit State and it is difficult for the State to bear the expenditure upfront and claim reimbursement,” an official explained.
Out of Rs 4,006.43 crore to be reimbursed by the Centre, the MoJS has sent proposals worth Rs 2,234.87 crore for clearance, as recommended by the PPA, to the Finance Ministry. It is expected to be processed shortly and the money is likely to reach the State in a few weeks. The balance Rs 1,771.39 crore worth bills are under the PPA’s scrutiny.
The Centre is of the view that the State needs to expedite the execution and it was ready to reimburse the funds. Union Jal Shakti Minister Gajendra Singh Shekhawat on Tuesday said that the State has to expedite the implementation of the project. The scrutiny of bills is also taking a considerable amount of time, sources said.
In September, the Centre, in Parliament, said that of the State government’s claim that Rs 12,505.94 crore expenditure has been incurred so far, the PPA rejected bills amounting to Rs 760.118 crore as they were found ‘ineligible’.
