Lok Sabha Question No. 2049 (UNSTARRED), answered on 2021-12-09
Subject: Funding of Irrigation Projects by PFC and REC
Ministry: POWER
Asked by: Uttam Kumar Nalamada Reddy

## GOVERNMENT OF INDIA MINISTRY OF POWER LOK SABHA UNSTARRED QUESTION NO.2049 ANSWERED ON 09.12.2021

## FUNDING OF IRRIGATION PROJECTS BY PFC AND REC

2049.   SHRI UTTAM KUMAR REDDY NALAMADA:

Will the Minister of POWER be pleased to state:

(a) the year of establishment of Power Finance Corporation (PFC) and Rural Electrification Corporation (REC);

(b) the objectives of the Government to establish PFC and REC along with the shareholding of Government in PFC and REC;

(c) the  year  in  which  the  objectives  of  PFC  and  REC  changed  to  fund  power  utilisation equipment in irrigation projects;

(d) the number of States which have received funding for irrigation projects from PFC and REC, State-wise;

(e) whether  the  tender  process  is  being  done  in  a  transparent  manner  in  the  irrigation projects which are being funded by PFC and REC; and

(f) the details of agencies executing the works from the funds sanctioned by PFC and REC?

## A N S W E R

THE MINISTER OF POWER AND NEW & RENEWABLE ENERGY

(SHRI  R.K. SINGH)

(a) : Power  Finance  Corporation  (PFC)  Ltd  was  established  on  16.07.1986  and  REC Limited (Formerly Rural Electrification Corporation Limited) was established on 25.07.1969.

(b) : The  objectives  of  the  Government  to  establish  PFC  and  REC  are  furnished  at Annexure-I and Annexure-II respectively. While the Government of India holds 55.99% stake in PFC, the Government does not hold any stakes in REC. However, PFC, holds 52.63% of stakes in the REC Limited.

(c)  & (d) : PFC  and  REC  lend  to  specific  portions  of  irrigation  projects  (Electromechanical [EM], Hydro-mechanical components and associated civil works such as pumps, motors, pressure mains,  etc.)  in  line  with  their  Object  clauses  in  the  Memorandum  of  Association  (MoA).  The relevant clauses of PFC are given at Annexure-III and the relevant clauses of REC are enclosed as  Annexure-IV.  Two  States  Andhra  Pradesh  and  Telangana  have  received  funding  for  the specific portion of irrigation projects both from PFC and REC. In addition to the above, REC Ltd has recently sanctioned loans in the states of Madhya Pradesh & Kerala also.

(e) : PFC  and  REC  are  Non-Banking  Financial  Institutions  engaged  with  the  lending operations and recoveries of their loans, and do not exercise oversight or manage the Tendering processes, which is carried out by the Project companies in terms of their applicable norms. PFC and REC are expected to exercise due diligence to ensure that costs are prudent.

(f) : The details of agencies executing the works from the funds sanctioned by PFC and REC are given at Annexure-V and Annexure-VI respectively.

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ANNEXURE-I ANNEXURE REFERRED TO IN REPLY TO PART (b) OF UNSTARRED QUESTION NO. 2049 ANSWERED IN THE LOK SABHA ON 09.12.2021

## **************

Main Objectives to establish PFC are given below : (i) To  finance  power  projects,  particularly  thermal  and  hydro-electrical projects. (ii) To  finance  the  renovation  and  modernisation  of  power  plants  aimed  at improving the availability and performance of such plants. (iii) To finance system improvement and energy conservation schemes. (iv) To  finance  maintenance  and  repair  of  capital  equipment  including facilities for the   repair  of  such  equipment,  training  of  engineers  and other personnel employed in  generation, transmission and distribution of power. (v) To finance surveys and investigations of power projects. (vi) To finance studies, schemes, experiments and research activities associated with   various  aspects  of  technology  in  power  development and supply. (vii) To finance promotion and development of other energy sources including alternate and renewable energy sources.

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ANNEXURE-II ANNEXURE REFERRED TO IN REPLY TO PART (b) OF UNSTARRED QUESTION

## NO. 2049 ANSWERED IN THE LOK SABHA ON 09.12.2021 **************

Main Objectives to establish REC are given below:

- I. To finance rural electrification schemes in the country;

II. To subscribe to special rural electrification bonds that may be issued by the State Electricity Boards on conditions to be stipulated from time to time;

III. To promote and finance rural electric cooperatives in the country;

IV. To administer the amounts  received  from time to time from the Government of India; and

- V. Other sources such as grants for the purpose of financing rural electrification in the country.

Further, objects incidental to attainment of main object permits the works  for  lift  irrigation  from  rivers  and  for  irrigation  for  development  of sugarcane,  tobacco,  tea-gardens,  other  crops  and  other  rural  uses,  including other works as per sub clause III(b)(3) of Memorandum of Association of REC. In addition to above clause which was existing prior to year 2009, the  objects  clause  was  amended  in  year  2009  to  include  various  activities having linkage with power projects, including financing of enabling infrastructure  facilities  that  may  be  required  for  the  speedy  and  effective development of power sector.

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## ANNEXURE-III

## ANNEXURE  REFERRED  TO  IN  REPLY  TO  PARTS  (c)  &  (d)  OF  UNSTARRED QUESTION NO. 2049 ANSWERED IN THE LOK SABHA ON 09.12.2021

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## Clauses for funding of Power Utilisation Equipment - PFC

PFC  has  been  funding  irrigation  projects (Only  Electrical,  Electro-mechanical components  and  associated  civil  works  of  an  irrigation  project)  through  enabling provisions  in  the  objects  of  MoA.  The  enabling  provisions  under  which  funding  of irrigation projects are being done are as under:-

- Main Objects to be pursued by the company:

Clause  1:  To  finance  power  projects,  in  particular  thermal  and  hydro-electronic projects.

Clause 2: To Finance power transmission and distribution works.

Clause  11:  To  finance  and  to  provide  assistance  for  those  activities  having  a forward and backward linkage, for the power projects, including but not limited to, such as development of coal and other mining activities for use as a fuel in power project, development of other fuel supply arrangement for power sector, electrification  of  Railway  lines,  laying  of  Railway  lines,  roads,  bridges,  ports  and harbors  &  to  meet  such  other  enabling  infrastructures  facilities  that  may  be required.

- Objects incidental or Ancillary to the attainment of the main Objects:

Clause 37: Generally  to  do  all  such  other  things  as  may  be  deemed  incidental  or conducive to the attainment of the objects or any of them.

- The other Objects for which the company is established are:

Clause 3: To undertake, carry out, promote and sponsor any program for development of power supply for promoting the social and economic welfare of, or the  uplift  of  the  rural  population  including  in  particular  the  economically  weaker sections and to incur any expenditure in respect thereof and to assist execution and promotion thereof either directly or through an independent agency or in any other manner.

The revised  enabling  provision  presently  applicable  for  funding  irrigation  projects (after MOA was amended in Oct, 2020 complying with Companies Act) is as given below :-

· 'To  finance  projects,  activities  or  works  including  electrification  works  of creation, up-gradation, renovation, improvement, maintenance, repair, modernization,  modification,  replacement,  augmentation,  etc.  of  electrical  and electromechanical  systems,  standalone  or  that  are  part  of  large  projects  e.g. Projects  of  Lift  Irrigation,  Sewage  treatment  plant,  Smart  City,  Electrification  of railway line, etc.'

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## ANNEXURE-IV

## ANNEXURE  REFERRED  TO  IN  REPLY  TO  PARTS  (c)  &  (d)  OF  UNSTARRED

## QUESTION NO. 2049 ANSWERED IN THE LOK SABHA ON 09.12.2021 **************

## Clauses for funding of Power Utilisation Equipment - REC

REC  has  been  funding  Power  utilization  equipment  for  irrigation  purposes since  incorporation  of  Company  in  the  year  1969.  Further,  REC  objects incidental to attainment of main objects {clause III (b)(3)} inter-alia permits the works for lift irrigation from rivers etc. which was existing prior to year 2009.  The  objects  clause  was  further  amended  in  year  2009  to  include various activities having linkage with power projects, including financing of enabling  infrastructure  facilities  that  may  be  required  for  the  speedy  and effective  development  of  power  sector.  The  gist  of  relevant  Clause  of Memorandum of Association of REC is reproduced below:

- I. To finance rural electrification schemes in the country;
- II. To subscribe to special rural electrification bonds that may be issued by  the  State  Electricity  Boards  on  conditions  to  be  stipulated  from time to time;
- III. To promote and finance rural electric cooperatives in the country;
- IV. To  administer  the  amounts  received  from  time  to  time  from  the Government of India; and
- V. Other  sources  such  as  grants  for  the  purpose  of  financing  rural electrification in the country.

Further,  the  objects  clause  of  Memorandum  of  Association  of  REC  was recently  amended  in  the  year  2021, inter-alia  which  also  includes  power utilization equipment in irrigation projects, electrical and electro-mechanical/ hydro systems, forming part of large projects including lift-irrigation projects, etc.

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## ANNEXURE REFERRED TO IN REPLY TO PART (f) OF UNSTARRED QUESTION NO. 2049 ANSWERED IN THE LOK SABHA ON 09.12.2021

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## Details of Agencies executing the works from the funds sanctioned by PFC

Kaleshwaram Project: Implementing Agency (Kaleshwaram Irrigation Project Corporation Ltd.)

| Engineering, procurement and construction (EPC) Package                                                                             | Name of the Contractor                             |
|-------------------------------------------------------------------------------------------------------------------------------------|----------------------------------------------------|
| Package 6 (tunnel/canals from Sripada Yellampally Reserovir to Medaram Tank, Pump House and Associated works)                       | M/s. NAVAYUGA-PATEL BHEL (Consortium)              |
| Package 8 (tunnel/canals from Medaram Tank to Midmainair reservoir, Pump House and Associated works )                               | M/s. MEIL-SEW-MAYTAS BHEL (Consortium)             |
| Package 9 (tunnel/canals from Midmainair reservoir to Upper Manair Reservoir, Malkapet Reservoir, Pump House and Associated works ) | M/s. IVRCL-BATPASCO- WPIL-MHI (JV)                 |
| Package 10 (tunnel/canals from Midmainair reservoir to Anantagiri Reservoir, Pump House and Associated works)                       | M/s. HCC-MEIL-BHEL (JV)                            |
| Package 11 (tunnel/canals from Anantagiri Reservoir to Sri Ranganayaka Sagar, Pump House and Associated works)                      | M/s. SEW-MEIL-BHEL (JV)                            |
| Package 12 (tunnel/canals from Sri Ranganayaka Sagar to Sri Komaravelly Mallana Sagar Reservoir, Pump House and Associated works)   | M/s. MEIL-SEW-ABB-AAG (JV)                         |
| Package 14 (canal upto Konda Pochamma Reservoir, Pump House and Associated works)                                                   | M/s. Megha Engineering Infrastructure Ltd          |
| Package 20 (tunnel/canals from SRSP Foreshore to Masani Tank,Pump House and Associated works)                                       | M/s. IVRCL-BATPASCOP- WPIL-MHI (JV)                |
| Package 21 (tunnel/canals from Masani Tankto Kondem Cheruvu, Pump House and Associated works)                                       | M/s. NAVAYUGA-AAG-ABB (JV)                         |
| Package 22 (tunnel/canals from Kondem Cheruvu to Bhumapally Reservoir ,Pump House and Associated works)                             | M/s. SCL-INDU-KBL-WEG (JV)                         |
| Package 27 (Canal System from Sriram Sagar to Dilwapur Village)                                                                     | M/s. SUSHEE-ZVS- FLOWMORE (JV)                     |
| Package 28( Canal System from Sriram Sagar to Hangarga Village Village)                                                             | M/s. MEIL-ZPS-PVSRSN-ITT (Consortium)              |
| Package 21A ( Pressurized Pipe System)                                                                                              | M/s. MEIL-HES (JV)                                 |
| Medigadda barrage                                                                                                                   | M/s. L&T PES (JV)                                  |
| Medigadda Lift                                                                                                                      | M/s. MEIL NCC (JV)                                 |
| Annaram Barrage                                                                                                                     | M/s. AFCONS VIJETA PES                             |
| Annaram Lift                                                                                                                        | M/s. Megha Engineering Infrastructure Limited, HYD |
| Sundilla Barrage                                                                                                                    | M/s. NAVAYUGA GMW (JV)                             |
| Sundilla Lift                                                                                                                       | M/s. Megha Engineering Infrastructure Limited, HYD |

............2.

## Palamuru  Rangareddy  Lift  Irrigation  Project:  Implementing  Agency  (Kaleshwaram Irrigation Project Corporation Ltd.)

| EPC Package                                             | Name of the Contractor                 |
|---------------------------------------------------------|----------------------------------------|
| Package 1 Pump House at Narlapur and associated works   | M/s Navayuga Engineering Company Ltd., |
| Package 5 Pump House at Yedula and associated works     | M/s MEIL-BHEL (JV)                     |
| Package 8 Pump House at Vattem and associated works     | M/s MEIL-BHEL (JV)                     |
| Package 16 Pump House at Udandapur and associated works | M/s Navayuga - RVR (JV)                |
| Substation and Transmission lines                       | TSTRANSCO                              |

Rayalseema Drought Mitigation Project: Implementing Agency: Andhra Pradesh Rayalseema Drought Mitigation Projects Development Corporation Limited

| Project work                                                                                                                                  | Name of the Contractor                                                                   |
|-----------------------------------------------------------------------------------------------------------------------------------------------|------------------------------------------------------------------------------------------|
| Rayalaseema Lift Scheme to draw and utilize 3 TMC per day from Sangameswaram to SRMC at Km 4 from Pothireddypadu Head Regulator               | M/s SPML- NCC- MEIL (JV)                                                                 |
| Formation of Rajoli Reservoir across Kundu River on upstream side of existing Rajoli Anicut for a total storage capacity of 2.95 TMC of water | M/s MRKR- RITHWIK (JV), HYD                                                              |
| Construction of Joladarasi Reservoir with 0.80 TMC capacity across Kundu River at Joladarasi (V), Koilakuntla (M), Kurnool Dist.              | M/s MRKR- RITHWIK (JV), HYD                                                              |
| Improvements of GNSS FFC : Widening of GNSS FFC from Owk Reservoir to Gandikota Reservoir                                                     | M/s MRKR Constructions & Industries Pvt Ltd, Hyderabad                                   |
| Additional Gandikota Tunnel to carry 10,000 cusecs for feeding to Gandikota reservoir.                                                        | M/s MRKR Constructions & Industries Pvt Ltd, Hyderabad                                   |
| Errabali Lift Irrigation Scheme to supplement UCIL affected villages including Formation Reservoir at Giddangivaripalli                       | M/s MRKR Constructions & Industries Pvt Ltd, Hyderabad                                   |
| Kundu Lift Irrigation scheme Upgradation of Gandikota CBR Lifts & Gandikota                                                                   | M/s Megha Engineering Infrastructures Ltd, Hyderabad                                     |
| Canal and GLI Systems                                                                                                                         | M/s Megha Engineering Infrastructures Ltd, Hyderabad                                     |
| GNSS to HNSS Lift Irrigation Scheme                                                                                                           | M/s PLR Projects Private limited, & Navayuga Engineering Company Limited (JV), Hyderabad |
| Package-I : Improvements of HNSS Main canal from - 4.806 Km to 88.00 Km                                                                       | Under Tendering Stage                                                                    |
| Package-2 : Improvements of HNSS Main canal from 88.00 Km to 216.3 Km                                                                         | Under Tendering Stage                                                                    |
| Enhancing the carrying capacity of Punganuru Branch Canal under HNSS P-II to feed upto Kuppam including irrigation network                    | Documents for Tendering under preparation                                                |
| Formation of three balancing reservoirs near Mudivedu, Netiguttapalli and Avulapalli                                                          | M/s NECL-RRCIIPL (Joint Venture), Hyderabad,                                             |
| Widening of Somasila Kandaleru Flood Flow Canal (SKFF)                                                                                        | M/s VPR-GDR-MRGR (JV)                                                                    |

.........3.

| Improvements to GKN Canal from Somasila to feed Rallapadu Reservoir   | VPR-GDR-MRGR (JV) Hyd Pvt Ltd          |
|-----------------------------------------------------------------------|----------------------------------------|
| Improvements to GNSS Canal from Km.0.00 to Km.56.00                   | Under Tendering stage                  |
| Alavalapadu Lift Irrigation Scheme                                    | M/S SLR Infra Pvt. Ltd, Hyderabad      |
| Galivedu Lift Irrigation Scheme                                       | M/S KCCL- NAR Joint venture, Hyderabad |

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## ANNEXURE  REFERRED  TO  IN  REPLY  TO  PART  (f)  OF  UNSTARRED  QUESTION  NO.  2049 ANSWERED IN THE LOK SABHA ON 09.12.2021

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## Details of Agencies executing the works from the funds sanctioned by REC

Project Name

Agencies executing the works from the funds sanctioned by REC

Sl.

No.

Andhra Pradesh

Borrower- Andhra Pradesh Water Resources Development Corporation (APWRDC)

1.

2.

3.

Chintalapudi Lift irrigation scheme

Kondaveetivagu Lift scheme - Flood relief Scheme

Purushottapatnam  Lift irrigation scheme

4.

Interlinking of Godavari-Penna Rivers Phase 1 Project

## Telangana Borrowers:-

- (i) Telangana State Water Resource Infrastructure Development Corporation Ltd. (TSWRIDCL)

## (ii) Kaleshwaram Irrigation Project Corporation Ltd. (KIPCL)

|   1. | Indiramma Flood Flow Canal (IFFC)                                                                                                                                                                                           | M/s Navayuga Engineering Company Limited;M/s Megha Engineering & Infrastructures Ltd.; M/s MEIL-RATNA-KBL (J.V), M/s Integrated Engineering; M/s Navayuga Engineering Company Limited, Hyderabad                               |
|------|-----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
|    2 | Sita Rama Lift Irrigation Project                                                                                                                                                                                           | M/s Megha Engineering & Infrastructures Ltd; M/s NCC-PRATHIMA-AMRUTHA (JV); M/s Megha Engineering & Infrastructures Ltd.; M/s SDC-KAVERI                                                                                       |
|    3 | PV Narasimha Rao - Kanthanapally Sujala Sravanthi scheme at Thupakulagudem                                                                                                                                                  | M/s SEW-RITHWIK                                                                                                                                                                                                                |
|    4 | J. Chokkarao - Devadula Lift Irrigation project Already executed E&M works under Devadula & Other works                                                                                                                     | M/s. Coastal Projects Pvt. Ltd., Patel Engineering Ltd., Jyoti Ltd., CBE Consortium; M/s. HCC SEW-MEIL-AAG(JV); M/s. NCC-MEIL-ZVS-SIGMA Consortium; M/s. MEIL-PRASD-KBL (JV); M/s. Megha Engineering & Infrastructures Limited |
|    5 | E&M, H&M and associated Civil works for lifting capacity enhancement of existing system by 1.1 TMC (Thousand Million Cubic Feet) water per day from Sripada Yellampally Project (SYP) to Mid Mannair Reservoir under Link 2 | M/s Megha Engineering & Infrastructures Ltd                                                                                                                                                                                    |
|    6 | E&M, H&M and associated Civil works for lifting of additional 1 TMC water per day from Medigadda Barrage on Godavari River to Reservoir at Sripada Yellampally Project (SYP) under Link-1                                   | M/s MEIL-NCC (JV); M/s Megha Engineering & Infrastructures Ltd                                                                                                                                                                 |
|    7 | E&M, H&M and associated Civil worksFor lifting of additional 1 TMC water per day from Mid Manair Reservoir to Sri Komaravelli Mallana Sagar Reservoir under Link-4                                                          | M/s Pratima-NCC-NECL (JV); M/s Megha Engineering & Infrastructures Ltd.; M/s KNR-NAVAYUGA-NCC (JV)                                                                                                                             |

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M/s MEIL & RVR

M/s.

Megha

Engineering

Infrastructures Ltd

M/s.

Megha

Engineering

Infrastructures Ltd

M/s MEIL & RVR

&

&