Polavaram Project Cost Skyrockets to ₹62,436 Crore
The ambitious Polavaram multi-purpose irrigation project in Andhra Pradesh has witnessed a dramatic cost escalation. Official figures now place the total expenditure at a staggering ₹62,436 crore. This represents a massive increase, more than six times the original estimate from nearly two decades ago.
Steady Rise in Project Costs Over the Years
When authorities first conceptualized the Polavaram project in 2005–06, the estimated cost stood at ₹10,151.03 crore. Over time, multiple factors drove the financial outlay steadily upward.
By 2010–11, the estimate had risen to over ₹16,010 crore. It reached ₹30,718.90 crore by 2013–14. The most significant jump occurred recently, with the revised cost now pegged at ₹62,436 crore.
Key Drivers Behind the Cost Escalation
Several elements contributed to this sharp increase. Land acquisition and rehabilitation and resettlement (R&R) expenses emerged as major drivers.
Officials revised compensation packages in line with updated norms. The number of project-affected families also increased following reassessments of submergence areas, particularly in tribal regions.
Official data shows that expenditure on R&R alone crossed ₹14,000 crore by 2017–18. Costs related to canals, spillway modifications, diaphragm wall construction, and strengthening of the cofferdam added further to the financial burden.
Administrative and Technical Challenges
Delays played a crucial role in pushing costs higher. Technical issues, frequent floods, changes in contractors, and coordination problems between the state and central governments created cascading effects.
Inflation in material prices and labour costs over nearly two decades compounded these problems. The project has already seen cumulative expenditure of ₹30,436.95 crore, even as significant works remain pending.
Funding Dilemma and National Project Status
The state government sent a comprehensive report to the Centre seeking release of an additional grant for launching the second-phase work. However, the Centre previously cleared revised cost estimates with a condition that no more revisions would be accepted.
Although Polavaram was declared a national project with 100 per cent funding from the Centre, the Union finance ministry is not fully content with the Jal Shakti Ministry's recommendations on revising estimates.
The state government consistently argues that the steep escalation resulted from factors beyond its control. These include statutory changes in land acquisition laws and prolonged execution timelines.
Project Benefits and Future Outlook
Once completed, Polavaram promises substantial benefits. It is expected to provide irrigation to over 23 lakh acres and supply drinking water to numerous urban and rural habitations.
The project will also generate hydroelectric power and play a key role in flood moderation along the Godavari basin. The irrigation component accounts for a substantial share of the costs, while power generation and flood moderation works contribute significantly.
Government officials reiterate that Polavaram remains a national project. They emphasize that financial support from the Centre is crucial for its completion, highlighting the project's importance for Andhra Pradesh's development.
