There has been stiff competition between Soma and SEW. The bid process was mired in controversy following the allegation that the Chief Minister sided with SEW despite its technical shortcomings.
SEW held considerable stakes in Namaste Telangana, the newspaper owned by Mr C.L. Rajam, which is championing the cause of a Telangana statehood. The TD had accused TRS chief K. Chandrasekhar Rao, another partner in the newspaper, of compromising on the Telangana agitation after the government gave the Polavaram contract to SEW.
The CM, after much dilly-dallying cancelled the tenders and directed the irrigation department to call for fresh ones. The department this time took precautions to ensure that SEW overcomes the previous technical shortfalls.
But, the delay in cancelling the tenders and calling fresh ones took its toll on the exchequer. The project cost went up by Rs450 crore going by Soma's previous offer of Rs4,147 crore.
“There is some cost escalation because of the revised SSR rates,” a senior irrigation official acknowledged.