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?
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
The evidence of Pawar’s culpability is mounting by the day. INN 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.
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.
Ajit Pawar became irrigation minister in 1999 and remained so for the next 10 years until Marathi newspaper Loksatta, a publication of the Indian Express Group, carried a series of damaging reports on the nexus between Pawar and a few select irrigation contractors. Between 14-19 December 2009, Loksatta exposed how Pawar awarded two projects worth Rs 1,385 crore to a Pune-based builder-cum-contractor named Avinash Bhonsle at an inflated cost.
- Till date, he has bagged irrigation tenders worth Rs 3,000 crore
- After his firm bagged the tenders, their cost was escalated manifold by arbitrarily adding to the work scope
- Till November 2005, his company was known as Shakti Kumar M Sancheti Ltd. It was then renamed SMS Infrastructure Limited
- According to government rules, no company can get more than three contracts
- To circumvent that rule, Sancheti took contracts simultaneously, both in the new name as well as the old name of the same company
- Since 2006, he has bagged contracts worth Rs 1,300 crore in the old name of his company
- On 23 March 2007, he got a contract worth Rs 94 crore in the Gosekhurd project’s rightbank canal in the name of Shakti Kumar Sancheti, a company that had ceased to exist
- On 1 January 2008, he similarly won a contract worth Rs 217 crore in the Gosekhurd project using the old name
- On 12 August 2009, he won a contract worth Rs 926 crore in the Lower Penganga project in the old name of his company
- He was paid an advance of Rs 120 crore without having done anything on the ground
- The concrete wall of the Gosekhurd project’s right-bank canal built by Sancheti has titled at several places. No action taken till date
In the wake of the reports, Pawar appointed two inquiry committees and handed over the charge of the irrigation department to his confidant and NCP MLA Sunil Tatkare on 11 November 2010. The stories soon died a quiet death. The inquiry committees submitted their reports, but neither the media nor the Opposition parties paid any attention to the findings of the massive financial bungling and irregularities tabulated in the reports.
In the meantime, Pawar was shifted to the high-profile ministries of finance & planning and energy. In December 2010, Pawar replaced Chhagan Bhujbal as the deputy chief minister. It is now believed that Ajit Pawar is the de facto NCP chief, with his uncle Sharad Pawar being reduced to a mere figurehead. Political observers believe that Ajit’s 10-year stint as irrigation minister has much to do with his rise within the party. It is alleged that Pawar built his political war chest mainly through the pilferage of irrigation funds.
On 25 September, when Ajit Pawar made the surprise announcement of his resignation, all 19 NCP ministers also offered to resign to express their solidarity with the junior Pawar. Sharad Pawar was neither consulted nor informed about the resignations tendered by these NCP ministers (interestingly, the resignations were sent to NCP state party chief Madhukar Pichad and not the chief minister).
But what is most intriguing about Pawar’s resignation is that it has not come as a result of the registration of an FIR or the start of any investigation (like in the case of A Raja or Dayanidhi Maran). It is rather a stratagem to thwart any possible attempt to probe the scam or register an official inquiry. Chief Minister Chavan, who is not much liked by the Congress legislators themselves, is under pressure to soft-pedal the whole scandal. During the last Assembly session, Chavan had announced that his government would soon issue a white paper on the expenditures incurred on different irrigation schemes. But the promised white paper has not been put out till date. Two separate PILs have been filed by NGOs — one before the Bombay High Court and the other before the Nagpur bench of the HC — demanding an independent investigation into the scam, but both are at the initial stages. As of today, no official investigation into the scam has been initiated by the government.
At first view, the evidence against Pawar is incriminating. In fact, if the quality of evidence collected by the CBI against Raja and Suresh Kalmadi is taken as a yardstick, then the evidence against Pawar is far more overwhelming. Every contract worth Rs 1 crore or more has been awarded with Pawar’s signature on it. What is more damaging is the fact that Pawar wrote notes overruling his own officers who were flagging violations in tender and payment processes.
For instance, on 16 April 2008, Under Secretary BT Redkar issued a circular saying established rules and procedures of the Irrigation Department prohibited the advance payment of huge amounts to private contractors. He wrote that it is being observed that large sums of money was being paid to private contractors in the name of mobilisation and machinery advance. Redkar cautioned that if henceforth such advances were made, the department would initiate punitive actions against the officers responsible.
- He was a small-time contractor 10 years ago
- Coterminus with Pawar’s reign as irrigation minister, his fortunes saw a meteoric rise
- Pawar awarded contracts worth 476 crore in the Vidarbha region in 2009 alone
- In Marathwada and other regions, he has won contracts worth more than Rs 1,000 crore
- In 2008, he entered the Maharashtra Legislative Assembly on an NCP ticket. This year, he has been re-elected as an MLC
- He is known as one of Ajit Pawar’s closest cronies
- His father was a small-time contractor
- Pawar gave him contracts worth Rs 820 crore in 2009. Later, a tender of Rs 532 crore was cancelled after the issue of irregularity was raised by the Opposition in the Assembly
- In 2010, Pawar made him an MLC
- A decade ago, the annual turnover of his firm was around Rs 20 lakh
- He was a Class III contractor who executed projects worth just a few lakhs of rupees
- Over the past four years, he has bagged contracts worth over Rs 500 crore
- His family runs a Marathi daily called Lokshahi Vaarta from three districts in Vidarbha and uses it to promote his business interests
- The paper ran full-page stories saying that the construction of the Gosekhurd project was of superior quality and the CWC chairman’s report on shoddy construction was incorrect
- In June, the BJP made him a member of the Maharashtra Legislative Assembly
On 25 April 2008, Deputy Secretary TN Munde issued a circular saying that instead of following the scheduled rates fixed by the department for various materials and components used in construction work like cement, steel and iron bars, the department was making the payments at prevailing market rates, which were highly exorbitant.
On 14 May 2008, Pawar dashed off a letter via his private secretary Suresh Jadhav, which said: “It has been noticed by the minister that the department was issuing circulars without his knowledge. Henceforth, before issuing any circular, the minister’s sanction ought to be obtained.” In the same note, the minister’s office instructed that the two circulars should be repealed with immediate effect.
On 16 May 2008, as many as six senior officers of the Irrigation Department wrote to Pawar saying that the two circulars in question merely reiterated the established rules and regulations and didn’t lay down any new provision.
After two weeks, Pawar issued a one-page note saying that his earlier order should be implemented and the two circulars should be immediately revoked. More damagingly, he noted that if it were not done so, the tender files would have to be routed to the Finance Department, which would invite an unnecessary scrutiny from finance officials. Records with INN show that after Pawar’s intervention, more than Rs 600 crore was paid as mobilisation advance to private contractors. Ajay Sancheti was a major beneficiary of such advances. The Vadnare Committee reveals that contractors were paid several times of the market price for different construction materials. For instance, in the case of Jigaon irrigation project, NCP MLC Sandip Bajoriya’s firm was paid Rs 1.6 lakh per tonne of pipe when the market rate was Rs 80,000 per tonne.On 16 May 2008, as many as six senior officers of the Irrigation Department wrote to Pawar saying that the two circulars in question merely reiterated the established rules and regulations and didn’t lay down any new provision.
In February, Chief Engineer Vijay Pandhare, 57, wrote a letter to the Governor, the CM and the Irrigation Department’s principal secretary, alleging that there was rampant corruption in the department. The secretary wrote back, asking Pandhare to furnish concrete evidence.
On 5 May, Pandhare wrote a 15-page letter detailing the modus operandi and the specifics of the scam. Pandhare has served in the Irrigation Department for more than 30 years and is presently serving as a member of the State Technical Advisory Committee, which vets the cost estimates of tenders before they are finalised.
Following were the revelations made in the letter:
• Nardave dam, Konkan. The dam’s height was raised and the cost was revised from Rs 200 crore to Rs 650 crore without any official sanction. Crores of rupees were paid as false claims and sanctioned by the executive director
• Narvade dam is just one example. Initially, minor irrigation projects are approved. After the approval, a proposal is mooted to increase the dam’s height. In this manner, the scope of the work is hiked by many crores
• A classic example of incurring wasteful expenditure is the case of 11 barrages being constructed in Washim district. In 2008, an estimate of Rs 7-8 crore was prepared and sanctioned. Within a year, the cost estimate was enhanced to Rs 50 crore. All such expenditure is wasteful. The estimates are enhanced on the whims and fancies of private contractors. If investigated, one would find more such instances of artificial enhancement in the project costs
• The entire scheme of lift irrigation has been a disaster (by lift irrigation, the water is raised to an high altitude with the help of electric pumps and then distributed through canals). Of the total Rs 25,000-30,000 crore being spent on the scheme, more than 90 percent would go waste. Of the existing 3,000 lift irrigation schemes, 99 percent are non-functional. Despite such a dismal track record, why have new schemes been launched? Is it not to just get kickbacks?
• Senior officials and politicians are well aware of these facts. But in order to float big tenders and get a cut, inflated tender costs are prepared. Since the time the companies have been incorporated, many unviable, unwarranted and expensive projects have been initiated, which have only benefited the politicians and not the farmers
• The cost-benefit ratio shown for almost every tender is false. It is an act of jugglery by which unfeasible projects are shown as feasible. We haven’t been able to achieve even the 20 percent target of the land covered by irrigation
• The entire 23 km stretch of Gosikhurd project’s left-bank canal has developed cracks. Has it happened just like that? Such gross irregularities were committed but no engineer was suspended. The message sent out is that no matter how much inferior work is done by the contractors and engineers, the political class shall always save them
• The Irrigation Department is in shambles. All the bureaucrats fear the political class
Pandhare’s letter was met with complete silence. On 15 September, the letter made its way to the press. Ten days later, Pawar resigned.
The most dismaying aspect of the scam is that lakhs of farmers, particularly in the Vidarbha region for whom the projects were supposed to bring relief from the unending cycle of droughts, have still not been provided irrigation facilities. This despite the cost of the projects being raised from 100 to 1,000 percent.
Following is the list of 10 major irrigations projects that have been in limbo for many decades. The statistics given here is as published in the programme schedule submitted by the VIDC before the Maharashtra Assembly in March:
• The Gosekhurd irrigation project was launched in 1982 with the objective of irrigating 2.5 lakh hectares. The original project cost was Rs 372 crore. By 2008, the cost was hiked to Rs 7,777 crore. There is a fresh proposal to escalate the cost to 13,000 crore. As of March 2011, Rs 6,609 crore has been spent. As of today, only 1,582 hectares is actually getting water from the project
• The Human irrigation project in Chandrapur district was launched in 1983. Rs 204 crore has been spent so far. But no irrigation potential has been created
• Lower Wardha project in Wardha district was launched in 1981. The original project cost wasRs 48 crore. The objective was to irrigate 63,333 hectares. By 2011, the cost was escalated to 2,356 crore. Rs 373 crore has been spent so far. No land is receiving water from the project
• Bembala project in Yavatmal was launched in 1992. The original cost was Rs 190 crore. Today, the revised cost stands at 2,176 crore. The target was to cover 54,000 hectares. At present, only 10,330 hectares is receiving water; only one-fifth of the target has been achieved. Rs 1,337.67 crore has already been spent
• Khadakpurna project in Buldana district was launched in August 1981. The original cost was Rs 79 crore and the target was to irrigate 25,000 hectares. Rs 665.33 crore has been spent till date. Only 1,189 hectares is receiving water
• It took 37 years to complete Bawanthadi project in Gondiya district. The original project cost was Rs 11.66 crore. By the time the project was over, Rs 559 crore was spent
• Jigaon project in Buldhana district was launched in 1990. The original cost was Rs 394.83 crore and the target was to cover 1,010 hectares. The escalated cost now stands at Rs 4,044.14 crore. Rs 747.55 crore has already been spent. No irrigation potential has been created
• Lower Penganga project in Yavatmal district was launched in 1997. The original cost was Rs 1,042 crore. Over a period of 12 years, the cost was escalated to Rs 10,429.39 crore. The target was to irrigate 2.27 lakh hectares. Not even an inch of land has benefited so far
• Lower Pedhi project in Amaravati, one of the most droughthit districts in Maharashtra, was launched in 2004. The original cost was Rs 161 crore. Over the next four years, the cost was escalated to Rs 594 crore. Rs 288.96 crore has been spent so far
• Ajansara project in Wardha district was initiated in 2006. The original cost was Rs 153 crore. The cost was soon escalated to Rs 208 crore. The target was to cover 2,808 hectares. Not an inch of land has received water so far
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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