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Krishna Valley builders to protest against bill delays; government says rising costs will delay the project

Maharashtra's Finance Minister Mahadev Shivankar has made a provision for Rs 1 billion for paying outstanding arrears to contractors involved in Krishna Valley Development Project. The latter had set a deadline of September 14 to go on a fast unto death in protest against Chief Minister Manohar Joshi's empty assurances. Further discussions about the settlement would soon take place, the minister said.

Shivankar assured the contractors that another tranche of Rs 5 billion will soon be released. Contractors' representative Mahendra Satav meanwhile made a fervent plea to legislators from western Maharashtra region (the main beneficiary of the project) to resign immediately in protest against the bickering between the ruling Shiv Sena-Bharatiya Janata Party alliance which is further delaying firm decisions on the fate of the project.

''Joshi had barely a week ago had assured the contractors about the settlement of their outstanding dues. But till today we have not received even a dime,'' Satav disclosed at a press conference. He alleged that Irrigation Minister Eknath Khadse is responsible for the delay in payment dues.

Meanwhile, Satav expressed his displeasure with the 60 MLAs from the western Maharashtra region who, he said, were indifferent to the cause of the contractors. Even as Joshi said that the outstanding arrears are Rs 5 billion, Satav informed the amount is a whopping Rs 13 billion and the project work has stopped completely from the last six months.

Holding the chief minister, deputy chief minister, and irrigation development minister responsible, Satav wanted to know what steps the authorities are taking to alleviate the situation. He disclosed that the chief minister had assured him the release of first tranche of Rs 1 billion before September 4, followed by a second tranche of Rs 2.5 billion within a week with the finance minister's permission and the remaining amount in the next five weeks. But that was not to be.

Meanwhile, the state government has admitted on Friday that it cannot complete the Krishna Valley project the year 2000. Construction of the canal network has been postponed. Instead, focus will be on construction of dams to block Maharashtra's share of the Krishna waters.

The irrigation minister said the postponement was inevitable because of the rising costs and the March 2000 deadline for dam construction. The valley project cost has escalated by Rs 40 billion, he added. The original cost was estimated at Rs 71 billion, not it has been revised to Rs 115 billion, he said.

He further said the state government would raise Rs 5 billion through bonds for the project from September 14.

The government has decided to give priority to impounding of the Krishna waters for which an additional planning of Rs 41 billion was required. Out of the additional amount, projects worth Rs 30 billion would be taken up immediately to impound 594 thousand million cubicfeet of water.

Referring to the contractors' arrears, he said the government owed them Rs 5.88 billion. The project had funds of Rs 900 million and another Rs 4 billion would be raised through equity (Rs 2 billion) and short-term loan from other corporations (Rs 2 billion) while Rs 1.5 billion would be raised from loans and bonds, he added.

Khadse said the National Bank for Agricultural and Rural Development was ready to give Rs 2 billion for the project and the state government had also urged the Centre to provide financial assistance for the scheme.

The government had disbursed Rs 120 million to 136 farmers on Thursday. On the same day about Rs 18 million had been paid to cement contractors and another Rs 10 million had been paid to steel contractors.

Compiled by Prasanna D Zore from Marathi media and UNI