Ray of hope for Shahpur Kandi project

  • Gurpreet Singh Nibber, Hindustan Times, Chandigarh
  • Updated: Dec 25, 2015 13:35 IST
Shahpur Kandi Dam (HT Photo)

The governments of Punjab and Jammu and Kashmir have agreed to a 19-point agreement to resume work on the much-delayed Shahpur Kandi dam project over the Ravi river on the inter-state border.

The agreement is expected to come up for approval in the upcoming meeting of the J&K cabinet, following which it will be signed.

Work was stopped on August 20 last year due to Jammu and Kashmir’s objections. The neighbouring state’s main concern was that the 1979 agreement between the two states had lost relevance in view of the Punjab Termination of Agreements Act, 2004, enacted by the state government headed by then chief minister Capt Amarinder Singh.

The J&K government got the construction stopped and insisted on signing a fresh agreement, despite Punjab’s assurance to abide by provisions of the 1979 agreement. Punjab had also clarified that the 2004 Act was not applicable to Jammu and Kashmir as it was a riparian state.

Other issues pertained to the project design and provision of jobs to local people affected by the project.

“We are hopeful about resumption of the project very soon,” said a chief engineerrank officer of the Punjab government.


As per the agreement signed with Soma Builders to construct the dam in the EPC (engineering, procurement, construction) mode, the penalty is to be borne by the Punjab government for delay in the project.

A senior functionary of Soma Builders said the company had already written to Punjab to pay the cost of delay and idle manpower as well as machinery. Though any quantum of penalty for the delay has not yet been fixed, it runs into crores of rupees. The builder also hinted at an increase in the construction cost.


The Shahpur Kandi dam is part of the Ranjit Sagar Dam (RSD) project, which was conceived in the late 1970s. The RSD project was completed at a cost of `6,800 crore in 1998, but it remains underutilised as the Shahpur Kandi project is yet to take off.

Experts say the hypothetical losses due to delay in power generation are estimated at thousands of crores of rupees. About 71% of the cost of the Shahpur Kandi project is to be borne by the Punjab State Power Corporation Limited (PSPCL) and the rest by the irrigation department.

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