Polavaram project's completion by 2019 appear improbable: CAG

Finding fault with the Andhra Pradesh government for failing to enforce contract conditions, the Comptroller and Auditor General has said possibility of completion of the Polavaram multi-purpose project on the Godavari by the target date of 2019 "appear improbable." 

In its audit report on the Economic Sector for the year-ended March 2017, tabled in the state Legislative Assembly Wednesday, the CAG noted that progress of execution of Polavaram project had been slow, mainly due to "improper planning, delays in finalisation of designs, land acquisition, rehabilitation and resettlement."

"As a result, the possibility of completion of the project and achievement of intended objectives by the target date of 2019 appear improbable. Audit findings indicate that completion of project by June 2019 is at huge risk," the CAG report said.

It also found fault with the state government for failing to enforce the contract conditions and allowing several concessions amounting to Rs 1,853 crore to the head works contractor.

"Yet, the progress (of works) was not in tandem with the scheduled completion time. Despite slow progress and delays attributable to the contractors, the (Water Resources) Department failed to levy liquidated damages on the contractors," it said.

The CAG also pointed out that only four per cent of the 1,05,601 project displaced families were rehabilitated in the last 12 years while rehabilitation and resettlement plans for 192 of 371 total villages were not even finalised.

It also said the AP government was yet to sort out submergence issues with neighbouring states Odisha and Chhattisgarh and the construction of protective embankments to prevent submergence in those states had not yet commenced.

Importantly, the CAG noted, the AP government did not conclude a memorandum of understanding with the Union government as per the national project guidelines though more than four years have lapsed since Polavaram was declared a national project.

The state government, though, replied to CAG that a draft MoU was submitted to the Centre.

The CAG, however, said the state government should expedite conclusion of the MoU with the Union Ministry of Water Resources so as to streamline the process of getting central assistance in a timely manner.

It also asked the state water resources department to improve its ability to enforce the contract conditions in the execution of project works to"avoid any further time overrun and cost overrun."