HYDERABAD: The finance department may have been kept out of the loop on several decisions taken by the then BRS government’s Cabinet with respect to the Kaleshwaram lift irrigation scheme (KLIS), particularly with reference to the funds used for the project.
This aspect emerged during the cross examination of special chief secretary (finance) K. Ramakrishna Rao by the Justice P.C. Ghose-headed commission of inquiry into various aspects of the KLIS barrages. Ramakrishna Rao headed the department since 2014, the year the BRS took charge of the government.
Ramakrishna Rao, in response to one of the 24 questions he faced from the commission, also informed Justice Ghose that a core committee of senior officials formed to oversee the project execution, and construction, did not keep the finance department informed on the progress of the project.
When the commission asked whether the core committee apprised the finance department on progress on a regular basis as mandated in GO No. 2412, dated November 3, 2016, Ramakrishna Rao responded saying “there is no record of the committee constituted by the GO apprising the progress of the project on a continuous basis.”
The official was also grilled on terms and conditions laid down in GO No. 145, issued by the then BRS government on October 6, 2015, which laid down that the project was to be offered on a turnkey basis. To a question from Justice Ghose that “‘GO 145 said state shall ensure execution of the project through turnkey contracts’, but it appears from facts that there was deviation by the government, and this norm was not followed,” Ramakrishna Rao replied saying “whatever is in the GO is correct.”
In a turnkey system, the government lays down its requirements and the contractor takes the responsibility for the investigations, planning, design, and construction of a project. In the case of the Kaleshwaram project, the government had followed a ‘piece rate’ system, with it taking the responsibility for investigations, planning, and design with the contractors merely executing the construction as per designs and specifications provided to them.
The top officer of the finance department was also asked several questions on the setting up of the Kaleshwaram Irrigation Project Corporation Limited by the government to fund the KLIS project.
Ramakrishna Rao explained that KIPCL was provided a `100 crore corpus fund and had the freedom to use this fund to generate further revenues. He also said the revenue model for KIPCL was to generate income through sale of water from KLIS to industries, from drinking water supplies, and through development of tourism facilities at different KLIS project sites.
Ramakrishna Rao also said that KIPCL, in all, earned Rs 7 crore in income from selling water to industries but could not remember which year this money was earned in. He said the government, as the guarantor for the loans raised by KIPCL was responsible for the repayments of the borrowings.
For this year, Ramakrishna Rao said in response to a question, the government has to pay Rs 7,382 crore before March 31, adding that this money was yet to be paid. As far as the interest — the rates which he said varied between 9 and 10.5 per cent from different lenders — on the principal loan amounts was concerned, for 2024-25, the government will have to pay Rs 6,519 crore.
Responding to queries on whether or not all the project proposals were approved by the Cabinet, and if they were routed as required through the finance department, as there were doubts if this was done by the book, Ramakrishna Rao replied that this was the case as far as he could remember.
