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Polavaram Authority cautions Andhra against retendering

The Andhra government had earlier this month cancelled the Polavaram works awarded to Navayuga Engineering and served the company with a preclosure notice.

, ET Bureau|
Aug 18, 2019, 10.22 AM IST
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An aerial view of Polavaram project
HYDERABAD: The Polavaram Project Authority (PPA), which oversees the Rs 50,000 crore irrigation project, has cautioned the YS Jagan Mohan Reddy government in Andhra Pradesh against retendering construction contracts.

“Such a step will result in unforeseen consequences and will plunge the project into uncertainty,” said PPA Chief Executive Officer RK Jain in a letter to the state government on Friday. “The project is not only likely to get delayed, it will have adverse socio-economic impact as well due to delay in realisation of benefits from the project, apart from likely increase in the cost of the project.”

Jain also urged the chief minister to abstain from preclosure and retendering of Polavaram works “in the best interests of the project” or at the least keep it “in abeyance till a considered view is taken by the Government of India.”

The Andhra government had earlier this month cancelled the Polavaram works awarded to Navayuga Engineering and served the company with a preclosure notice. The Reddy government decided to go ahead with its plan to start retendering process and complete it by September 15.

Jain’s letter comes days after Union Jal Shakti Minister Gajendra Singh Shekhawat expressing serious concerns in the Lok Sabha over the Andhra government’s decision to cancel Polavaram works. This could lead to delay and cost escalation, he said.

Reddy had during poll campaign alleged there were irregularities in projects and power purchase agreements signed by the N Chandrababu Naidu government, and had said he would annul those contracts. This had caused an uproar among industry and investors.

Two days before the Andhra government’s prestigious diplomatic outreach programme, held in Vijayawada on August 9, Japan had cautioned the state government against renegotiating and cancelling green PPAs.

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Polavaram authority says project not under Andhra panel purview

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