New Delhi, Oct. 31: The Planning Commission has given investment clearance to the Rs 433-crore Khuga Multipurpose Project (medium revised) in Manipur, a project that has seen a 30-fold increase in project costs since its inception.
The project, which is estimated to cost Rs 433.91 crore at 2011 price levels, was first approved in 1980 at a cost of Rs 15 crore.
Work began only in 1983-84 after the first contract was terminated "owing to tardy progress" admission by the state government.
The Khuga dam was finally inaugurated in November 2010 by Congress president Sonia Gandhi. However, days after the inauguration, a leakage was detected in the canal.
The project deadline was then extended to March 2011 with a revised estimate of Rs 381.28 crore. The announcement by the Planning Commission today has added another Rs 50-odd crore to the estimate based on the last fiscal calculation.
Allegations have been routinely levelled against successive state governments for milking the project. "Other reasons for the slow progress of the project are irregular fund flow, poor law and order situation, ethnic clashes at the project site," said a state irrigation department official.
On execution of the remaining work, the dam is expected to irrigate 15,000 hectares of land. However, canal repair and construction of the 15MW power plant are still pending.
The plan panel has said the project "shall be completed in the financial year 2012-13 and plan accounts will be closed by March 31, 2013".
Further, the commission has also drawn a redline stating that in case of any more cost revision, the project will be "debarred" from funding under Accelerated Irrigation Benefits Programme.
"Given that the state has been asked to execute the project according to the approved outlays in the state annual plans, the finance department should restrict the expenditure to the approved cost and no additional expenditure may be permitted unless the revised estimate is got approved following the prescribed procedure," the commission said.
The project authority must also seek approval of the Command Area Development plan from the commission. According to the commission, the CAD work will be executed concurrently with the project work so that participation of stakeholder farmers is ensured from project planning stage to its implementation and maintenance.
"This will ensure that the outlay on the project is converted into enduring outcomes in the form of assured and sustainable irrigation benefits to farmers and its implementation will be monitored closely," the plan panel said.