Hyderabad: The Andhra Pradesh government has issued a pre-closure termination notice for works over ₹3,000 crore, given to Navayuga Engineering Construction, which was supposed to complete part of the ongoing Polavaram irrigation project in the state.
The construction giant, which has offices across India, was issued the notice on 29 July, and has been asked to consent to the termination or exit the project and settle accounts in 15 days.
The development is in tune with AP chief minister (and YSR Congress Party supremo) Y. S. Jagan Mohan Reddy’s statements before the 2019 assembly and Lok Sabha elections that he would probe alleged irregularities in the Polavaram project, among other things, with regard to contracts given to companies by the previous Telugu Desam Party (TDP) government, led by former chief minister N. Chandrababu Naidu.
According to the pre-closure termination notice issued by the AP Water Resources department, Navayuga Engineering Company Ltd signed three contracts for different works amounting to Rs.1,244 crore (in February 2018), Rs.918.76 crore (in May 2018) and Rs.751.55 crore (with works to be completed in different time periods). The agreements were signed to undertake various engineering works like construction of power house foundations, spillways etc.
The notice from the state government was served on the recommendation of an expert committee, which was constituted on 14 June, 2019. The committee, which looked into the contracts signed between the construction company and the state government, recommended termination of the contract and to entrust the balance works to a fresh agency “by ensuring transparency in the tendering system".
A copy of the notice has been reviewed by Mint. When contacted, a senior official from Navayuga said that works in AP pertaining to the Polavaram project had been stopped for some time, but refused to comment on the notice.
After he became chief minister, Jagan Mohan Reddy formed a high-level body to probe alleged irregularities in various infrastructure projects. The YSRCP president alleged that Naidu and his government were involved in several irregularities in contracts for various works in the Polavaram project and also in the upcoming capital Amaravati.
The Polavaram national irrigation project, which will interlink several rivers in Andhra Pradesh, is estimated to irrigate 75.38 lakh acres in the state. It will also help supply 7.32 thousand million cubic feet (TMC) of drinking water to Visakhapatnam city and another 16.12 TMC of water for industrial purposes. The project is on the Godavari river near Ramayampet village of Polavaram mandal in West Godavari district.
The project also aims to help the Rayalaseema region (comprising Anantapur, Chittoor, Kadapah and Kurnool districts out of the total 13 districts in the state) get more water. Earlier in January, Naidu had said that about 60% of the project was completed. A senior TDP leader, who did not want to be named, said there was no reason to terminate Navayuga Construction Company Ltd’s contract. “Jagan basically wants to give contracts to people close to him," he alleged.