Budgeting Interlinking of Rivers
By Sudhirendar Sharma
Estimated to cost Rs 5,60,000 crores (US $ 112 billion) , it is the mother of all projects in India - envisaging 30 links across Himalayan and peninsular rivers. Doubts have already been expressed on its economic viability though Former Union Power Minister and Shiv Sena MP Suresh Prabhu, who heads the Task Force for executing the project, is confident about
mobilising resources for the same. Prabhu has already hinted at the possibility of levying interlinking surcharge or water tax but the upcoming Union Budget is unlikely to have any such reflection given the fact that elections are only a year away.The massive project -- a dream come true for the bureaucrat, engineer and contractor nexus -- has already turned into a major national debate. Environmentalists are agitated, economists are excited and the policy makers are divided, but the government seems adament. After all, the river linking project may or may not provide water to the parched drylands of the country (70 per cent of the country's cultivable area is rainfed) but will surely 'irrigate' the future prospects of at least the next ten generations of the people assigned to execute the mega-project.
Suresh Prabhu does not get tired to reiterate government's commitment to move ahead with the project by simultaneously brushing aside criticism as an unavoidable evil. The National Water Development Agency and the Ministry of Water Resources are unkind to all criticism levied against the project.
Though the National Water Development Agency has conducted feasibility studies on 6 of the possible 30 river links in last two decades, Suresh Prabhu is confident about completing the project within the unblievable time frame of ten years! If delays in project execution in the past are anything to go by, this confidence is indeed an overstatement. However, in the absence of punitive
action on cost overruns due to delayed execution optimism continues to capture the popular imagination!Given the incredible cost of the project, should the Task Force not be held accountable for taxing the public exchequer in the event of a likely delay? Already cost overruns between 50 to 893 per cent over original estimates have been reported from some of the large water development projects. This has meant a slap of Rs. 70,000 crores and Rs 110,000 crores on the public exchequer in the 10th and the 11th Five Year Plan respectively to complete
`spillover projects'.This leaves little scope of financing the interlinking project out of the planned expenditure. But the Task Force has continued to make everyone believe that indeed the project can be financed from within available resources. Current external debt situation, that has already touched a whopping Rs. 5,00,000 crore mark, may have discouraged the Task Force from opting for external lending. But internal resource condition doesn't seem any good either.
Having categorically negated raising external funding for the project, Prabhu has given a clarion call to the industry to come forward and support the costliest endeavour that the country has undertaken. The Federation of Indian Chambers of Commerce and Industry (FICCI) plans holding a national conclave soon to discuss its position in light of the potential benefits that might accrue from the project. Following the privatisation of a stretch
of Sheonath river in Chattisgarh, the private sector sees a distinct role for itself in managing country's water resources. The `interlinking of rivers' proposal may indeed provide that opportunity.The Radius Water Ltd , the company that has 'ownership' over a section of the Sheonath river under lease for thirty years, is selling water to the industry as well as the government. It is, however, another matter that the people on the banks of the river have lost ownership over their natural heritage; the farmers are not allowed to use river water; and the fishermen are barred from casting nets in the river. People even don't take risk of taking bath in the river.
By opening the floodgates to private sector investment in the interlinking proposal, the Task Force may indeed end-up bargaining the traditional rights of people over water resources. Because it is not only the capital investment that the government is seeking for the project but recurring expenses towards operations and management too. Privatisation helps achieve both, as consumers have to pay for every drop, whether be it for household needs or irrigation.
With operations and maintenance expected to cost no less than Rs. 30,000 per hectare for the interlinking proposal, the success of the project will depend on how best the recurring costs get realised from the users. Undoubtedly, the water-stressed communities that stand to benefit from proposed interlinking will have to incur the costs of sustaining the ambitious project. With this being the likely scenario, whose question the project is seeking to answer is anybody's guess?
Dr Sudhirendar Sharma is a water expert and columnist attached to the Delhi-based The Ecological Foundation.
He can be contacted [email protected]