Revised estimates: Centre’s nod to fund Polavaram

In a surprising development, the Revised Cost Estimates (RCE) of the Polavaram Irrigation Project amounting to Rs. 55,548.87 crore at 2017-18 price level has been accepted by the Advisory Committee of the Department of Water Resources, Government of India, in its meeting held on February 11, 2019. This was disclosed by Union Minister of State for Water Resources Rattan Lal Kataria while answering to a question raised by Congress RS member KVP Ramachandra Rao.
While the revised cost estimates of the project as per 2013-14 price-level is Rs. 54,466.10 crore, which included power component cost estimates at Rs. 4,560.91 crore. The power component cost has not changed for the RCE at 2017-18 price level. Kataria clarified that as per Ministry of Finance letter dated September 30, 2016, Centre has to provide 100 per cent of the remaining cost of irrigation component of the project for the period starting from April 1, 2014 to the extent of the cost of irrigation component on that date. Accordingly, the RCE at 2013-14 price level in addition to RCE at 2017-18 price level has been finalised.
When the Congress MP sought to know about the details of the dues cleared by the Centre, the Union Minister explained that till date, Central assistance of Rs. 6,764.16 crore has been released from time to time as per eligible proposals recommended by Polavaram Project Authority and Central Water Commission since April 1, 2014.
For further release of funds, in the letters dated July 26, 2018 and May 6, 2019, the State government was requested for submission of audited statement of expenditure incurred by the State on the project till March 31, 2014 and revised cost estimates of the project at 2013-14 price level. The Central Water Commission in a letter dated May 7, 2019 has intimated RCE of the project at 2013-14 price level as Rs 54,466.1 crore.
Further, as reported by the State government, Principal Accountant General (PAG) office, Hyderabad has completed the audit of Rs. 3,777.44 crore out of total expenditure of Rs. 5,175.25 crore incurred up to March 31, 2014.  The Ministry has again requested the State to submit audited statement of expenditure for the full amount. Further release of funds is dependent upon the compliance by the State government. He said as reported by the State government, the overall expenditure on Polavaram project since inception till June 7, 2018 was Rs 16,876.93 crore.
Interestingly, the revised estimates submitted by the Telugu Desam Government were amount to just around Rs. 33,000 crore. However, the Jagan Mohan Reddy-led government has submitted revised estimates amounting to nearly Rs. 55,600 crore which the Centre has agreed to. Many political analysts have pointed out that the YSR Congress Party, which had opposed TDP government’s estimates, has now itself escalated the cost to a much higher amount and submitted it to the Centre. This clearly indicates how the BJP is supporting the YSRCP in the state.

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