Andhra Pradesh: The Central government has no problem with additional funding for the Polavaram project as demanded by the Andhra Pradesh Government for completing the balance work to store water in the reservoir up to over 41 metres, Minister of State for Jalshakti informed the Lok Sabha on Thursday. The Polavaram irrigation project (PIP) has been constructed on the River Godavari in Andhra Pradesh. It is a multi-purpose hydro-power and irrigation project that has a surface area of 600 square kilometres and a catchment area of over three lakh square kilometres.
The Polavaram project was declared a national project by the Central government when the Andhra Pradesh Re-Organisation Act of 2014 was passed. In 2016, the Ministry of Finance decided to bear the 100 per cent cost of the project for its irrigation component, which will cover all the expenditure of the irrigation component of the project spent after April 1, 2014.
Cost of Polavaram project
The Polavaram project is being constructed in two phases. In June this year, the government of Andhra submitted a revised cost of Rs 17,144 crore for completing the balance work for the first phase under which phase water will be stored up to the level of 41.15 metres in the reservoir. According to the information given by the government in Parliament, the Centre has already reimbursed an amount of Rs 14,969.36 crore between April 2014 and May 2023. Since 01.04.2014 up to May 2023, an amount of Rs 14,969.36 crore has been reimbursed to the Government of Andhra Pradesh by the Central government against its total approved liability of Rs 15,667.90 crore as the balance cost of irrigation component only of the Polavaram project at 2013-14 price level.
Additional funding sought by Andhra Pradesh
In June 2023, Andhra Pradesh sought additional funding of Rs 17,144 crore for completing the balance work of the first phase of the project. The state government also sought an ad-hoc release of Rs 10,000 crore. In the same month, the Department of Expenditure of the Ministry of Finance communicated no objection to additional funding for completing the balance work of the Polavaram project that is to say an amount of Rs 10,911.15 crore for the work to fill the water up to 41.15 metres.
The Finance Ministry also approved Rs 2,000 crore for repairing the damages caused by floods to the project subject to approval by the Union Cabinet by modifying its earlier decision. According to the minister, the Andhra Pradesh government’s demand for the ad-hoc release of Rs 10,000 crore has been subsumed in the no-objection by the Department of Expenditure.
Why the cost ofthe Polavaram Project has gone up?
The Central government has already reimbursed Rs 15,000 crore against its approved liability of Rs 15,667.90 crore for completing the irrigation component of the first phase of work that was carried on after April 2014. However, Andhra Pradesh has sought an additional amount of Rs 17,144 crore. The proposal by the state government includes the cost of rehabilitation and resettlement of an additional 16,642 project-affected families of 36 villages which will be partly affected during the first phase itself rather than the second phase as per the earlier plan.
The Centre has clarified in Parliament that the said proposal is required to be firmed up and approved by the Government of India. Thereafter, the releases of funds will be processed from time to time as per the approved modalities, depending on the physical and financial progress of the Polavaram project.
Also read:Blow to Polavaram: CM Jagan asks for Rs 55,548 Cr; Centre offers just Rs 12,911 Cr
