The Brihanmumbai Municipal Corporation (BMC) has been directed to reopen negotiations with the contractor for the Gargai Dam project after its standing committee declined to clear a proposal that exceeded the original cost estimate.
The project, expected to add 440 million litres per day (MLD) to Mumbai’s water supply, was initially estimated at Rs 3,105 crore. When tenders were issued in December, Soma Enterprises Limited emerged as the lowest bidder with a quote of Rs 3,334 crore.
Following initial discussions, the bid was reduced to Rs 3,276 crore, which works out to Rs 5,396 crore including taxes. However, the standing committee raised concerns over the revised cost, which was still around 11% higher than the original estimate. Members also objected to a 2% incentive offered to the contractor after negotiations, terming it unjustified.
During a meeting held on March 18, the panel instructed the civic administration to renegotiate the contract and secure a price closer to the original estimate before seeking approval again.
A senior official said, “A meeting has been called with Soma Enterprises Limited, and the administration will seek its best possible revised price in line with the Standing Committee’s directions. A fresh proposal will then be placed before the next meeting of the Standing Committee.”
According to sources, the contractor attributed the higher bid to factors such as the time gap since the project was conceptualised in 2023 and the challenging terrain in Wada and Mokhada areas of Palghar district, where the dam will be constructed.
The proposed 69-metre-high dam near Ogada village will include a 2.2-km tunnel connecting to the Modak Sagar reservoir. The project also involves the cutting of around 3.1 lakh trees, necessitating compensatory afforestation.
Mumbai currently sources about 4,000 MLD of water from seven lakes, against a demand of 4,463 MLD, which is projected to rise to 6,900 MLD by 2041. The Gargai Dam is scheduled for completion by 2029.
Source: Swarajya
