Greed: The inside story of 70,000 crore Irrigation Scam

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Ajit Pawar Former Irrigation Minister

THE MEDIA reaction to NCP leader Ajit Pawar’s resignation from the Maharashtra deputy chief minister’s post has focussed on the politics, not the scrutiny of the multi-billion dollar irrigation scam per se. But it would be a grave mistake to see the scam mainly through the prism of the Pawar vs Pawar one-upmanship or the Congress vs NCP tug of war. Even by the ever-plummeting standards of probity in public life, the sheer magnitude of the money siphoned off by the politician-bureaucrat-contractor nexus is staggering.

In a letter dated 5 May to Maharashtra Chief Minister Prithviraj Chavan, Chief Engineer Vijay Pandhare, who is also a member of the State Technical Advisory Committee, claimed that more than Rs 35,000 crore — half the total amount of Rs 70,000 crore spent on irrigation schemes between 1999-2009 — has been pocketed by the nexus.

The scam warrants an independent and effective probe and urgent answers. How could a minister preside over a scam for more than 10 years, and no one in the system reacted? Where was the Opposition all these years? What happened to the inherent checks and balances? What was the CAG doing? Was the BJP and Shiv Sena not aware of the blatant loot? Why did three Congress chief ministers — Vilasrao Deshmukh, Sushil Kumar Shinde and Ashok Chavan — turn a blind eye to the ongoing plunder? Isn’t the Congress as much to blame as the NCP? Why were the new irrigation projects launched and funds diverted without completing the old ones? How could projects, which were initiated in the 1960s and ’80s, remain incomplete even in 2012? Why has there only been 0.1 percent increase in the total irrigation potential despite spending Rs 70,000 crore of taxpayers’ money? How is it that the contractors, who bagged the maximum projects, later went on to become MLCs and MPs on the BJP and NCP tickets?

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THE EVIDENCE

Ajit Pawar was the irrigation minister between 1999-2010

During this period, every tender worth more than Rs 1 crore was awarded on Pawar’s signature

Pawar twisted the administrative processes and ensured that he directly handled every file pertaining to new projects

Pawar overruled his officers who flagged the flagrant violations of government rules and regulations

Pawar dismissed the departmental circulars that prohibited the payment of advance monies to private contractors

He thus ensured that hundreds of crores of rupees was paid in advance to the contractors even before any work started

On Pawar’s instructions, the contractors were paid for construction materials at exorbitant rates instead of the scheduled rates fixed by the department

Pawar and VIDC Executive Director DP Shirke escalated the cost of 32 projects by more than Rs 17,000 crore

In doing so, the duo bypassed the irrigation secretary as well as the governing council. All approvals carry Pawar’s signatures

Chief Engineer Vijay Pandhare, the whistleblower, has alleged that Pawar is directly responsible for the scam

Pawar overlooked inordinate delays in project completion and shoddy construction work

Pawar sidelined upright officers who objected to the corruption and protected those who profited from the loot

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Nagpur-based businessman Ajay Sancheti, who is now a BJP Rajya Sabha MP and also a member of the party’s National Executive Committee, has got irrigation contracts worth more than Rs 3,000 crore. Three other contractors, who have been the major beneficiaries of the scam, are now members of the Maharashtra Legislative Council.

The evidence of Pawar’s culpability is mounting by the day. TEHELKA has internal file notings, which show that Pawar overruled his officers who objected to the huge sums of advance paid to contractors in brazen violation of the established rules and procedures. Pawar even cautioned his officers from raising such objections in the future.

Most of the contracts were awarded without any budgetary planning. For instance, in the Lower Penganga project in Yavatmal district, tenders worth Rs 3,200 crore were awarded when the total budget for the project was only Rs 100 crore at the time. Similarly, in the case of Jigaon irrigation project in Buldhana district, tenders worth Rs 1,322 crore were given against a budget of Rs 60 crore. In May, the Leader of the Opposition in the Legislative Council and BJP MLC Vinod Tawde said on the floor of the House that 5-7 percent of the total tender cost was paid in kickbacks to a person named ‘M’. Unmistakably, he was referring to the minister. Hence the inexplicable haste in awarding inflated tenders, which were at times 10-20 times the total budgetary allocations.

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The Story at a Glance

• Between 2009-12, a whopping Rs 70,000 crore was spent on different irrigation projects

• The 2012 State Economic Survey shows that the area under irrigation has enhanced by just 0.1 percent in the past decade — the lowest growth rate in the country

• Chief Engineer Vijay Pandhare blew the whistle in May. He produced evidence to show that more than Rs 35,000 crore, which is half the total money spent, has been pocketed by the politician-bureaucrat-contractor nexus

• Nearly 1,200 irrigation projects have been in limbo for years, and in some cases, several decades

• Lakhs of farmers, for whom these canals and dams were supposed to be built, are still dependent on the monsoons for irrigation purposes

• While old projects were not completed citing lack of funds, Ajit Pawar kept launching new projects and sanctioned funds for the same

• Leader of the Opposition Vinod Tawde has alleged that Pawar was paid 5-7 percent in kickbacks at the start of every project. Hence the haste in initiating new projects without completing old ones

• Pawar launched 141 projects in 2007 and 83 in 2008. Ninety-five percent of them have not been completed

• Most of the projects were carved up between a handful of contractors. Three of them are now MLCs belonging to either the BJP or the NCP. A decade ago, all three started off as small-time contractors. Today, they are billionaires

• The fourth, Ajay Sancheti, is BJP’s Rajya Sabha MP. Today, Sancheti has business interests across many states, including Maharashtra, Chhattisgarh and Jharkhand

• Within a span of three months in 2009, Pawar revised the cost of 32 irrigation projects in Vidarbha, the state’s most drought-prone region, by Rs 17,700 crore

• The revised cost projections of these were patently illegal as they were not presented before and approved by the Vidarbha Irrigation Development Corporation’s governing council (consisting more than half a dozen secretaries from different departments), which is mandatory as per the VIDC Act, 1997

• The cost of a single project named Lower Penganga in Yavatmal district was escalated by Rs 9,072 crore on 14 August 2009

• In August 2009, six tenders worth Rs 3,200 crore were awarded under the Lower Penganga project to companies controlled by BJP MP Ajay Sancheti, NCP MLC Sandeep Bajoriya, NCP MLC Satish Chauhan and a heavyweight contractor named Nisar Khatri

• In 2010, two inquiry committees were formed to look into the massive irregularities in the execution of irrigation projects in Vidarbha region

• A committee headed by former Irrigation Department Principal Secretary NK Vadnare found that the tender cost was escalated in blatant violation of government rules and regulations. The report was submitted in June 2010. No action has been taken till date

• Acommittee headed by Chief Engineer HT Mendgiri found that the entire stretch of 23 km of the left-bank canal of the Gosekhurd National Irrigation Project was so shabbily constructed that the entire stretch had to be rebuilt

• Half the stretch was constructed by a firm owned by Andhra Pradesh Congress leader Ramarao (Srinivasa Construction) and the other half was by BJP MLC Mitesh Bhangadia (MG Bhangadia). Both these firms have been paid over Rs 50 crore for this shoddy work

• In its report dated March 2011, the CAG has observed that shoddy construction of the Gosekhurd’s left-bank canal has resulted in wasteful expenditure of taxpayer’s money

• Improper planning and change in design resulted in time overruns with consequent cost overruns of Rs 7,126.52 crore as of March 2011 in 49 projects entrusted in 1997-99, the CAG observed

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Ajay Sancheti BJP MP

Within a span of three months in 2009, Pawar escalated the cost of 32 irrigation projects in Vidarbha, the most drought-prone region in the state, by Rs 17,700 crore. The revised cost projections of these were patently illegal as they were not presented before and approved by the Vidarbha Irrigation Development Corporation’s governing council, which is mandatory as per the VIDC Act, 1997.

On 24 June 2009, Pawar approved the cost inflation of 10 projects. Similarly, on 7 July 2009, the cost of five projects was inflated manifold. On 14 August 2009, the cost of 10 more projects was inflated by 100-1,000 percent.

As a result, between 1999-2010, the Maharashtra government spent around Rs 70,000 crore on different irrigation schemes. In addition, a liability of over Rs 1 lakh crore has been incurred, which the government now owes to private contractors. If the two figures are combined — the actual money spent till date and the amount due to contractors — the quantum of the scam would be in the range of Rs 1.7 lakh crore, the same as that of the 2G and coal scams.

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