The central government has allocated a sum of Rs 5,936 crore for the Polavaram Irrigation Project, an under-construction multi-purpose irrigation project on the Godavari river in the Eluru District and East Godavari District in Andhra Pradesh.
The project is seen as a pet project of Chief Minister Chandrababu Naidu whose Telugu Desam Party shares power with the ruling BJP at the Centre. Finance Minister Nirmala Sitharaman's Budget noted that the central government is fully committed to financing and early completion of the Polavaram Irrigation Project, which it termed as the lifeline for the state and its farmers.
"This will facilitate our country’s food security as well," she said.
In the Budget presented in July last year, the Centre allocated over Rs 50,000 crore, or 4 percent of the GDP, for the state. This included special financial assistance through multilateral development agencies, addressing the state's capital needs and funds for the early completion of the Polavaram project.
As per the Budget documents, the Centre has already released an amount of Rs 2,807.69 crore for the project.
In it representations to Prime Minister Narendra Modi and FM Sitharaman ahead of the Budget, Andhra Pradesh had demanded special assistance for the state, claiming that the revenue deficit grants meant for a period of five years was depleted by the previous administration within three years. Andhra Pradesh FM Payyavula Keshav also urged the Centre to accord priority to river linking projects in the state in the Union Budget 2025-26.
Andhra also demanded that the Centre adopt a 90:10 funding pattern for all centrally sponsored schemes in Purvodaya states (of which AP is a part) besides providing viability gap funding for different PPP projects including the development of road infrastructure, airports, ports and metro rail projects in Vijayawada and Visakhapatnam. The state has also sought the sanction of five textile clusters for AP keeping in view the huge number of weavers in the state.
Other than the Polavaram project, the Centre said it has made concerted efforts to fulfil the commitments in the Andhra Pradesh Reorganisation Act. Recognising the state’s need for a capital, we will facilitate special financial support through multilateral development agencies.
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