HP compensation demand for losses due to hydropower projects

The Supreme Court has asked Attorney General KK Venugopal to explore the possibility of an amicable solution to Himachal Pradesh’s demand for a huge compensation for the losses incurred by it due to construction of the Bhakra-Nangal and Beas projects on its land. The top court is seized of an original suit filed by Himachal in 1996 against the Centre, Punjab and Haryana demanding its entitlements following the completion of the projects.

Issue:

• Due to construction of the Bhakra Dam over the Sutlej, submergence and reservoir of water over large areas of land resulted in a loss of over 10,000 acres of cultivated and uncultivated land — trees and forests, towns and government buildings included — leading to unemployment, loss of agricultural and trading activity and revenue.
• Similarly, the construction of Pong Dam across the Beas led to submergence of over 6,500 acres of land in Kangra.
• Himachal Pradesh is seeking a compensation of Rs 2,199.77 crore from the Centre, Punjab, Haryana, Union Territory of Chandigarh and Rajasthan, in addition to 12 per cent share in power generated by the two projects free of cost under the Act.

The SC had directed the Centre to evaluate rights and liabilities of Himachal Pradesh, Punjab and Haryana in terms of the 1956 Act. The Centre submitted an affidavit in compliance of the directive after computing rights and liabilities by taking five different rates for the power tariff. In 2013, the Centre told the top court that Punjab and Haryana would have to pay compensation in the ratio of 58:42 to Himachal for short supply of electricity from the two projects since 1966. Or, Punjab and Haryana could compensate HP by allotting additional energy over a period of 30 years if they had any difficulty in making payment, the Centre had told the court. Paying the compensation through additional allocation of power would serve the dual purpose of compensating HP as well as lessening the impact on Punjab and Haryana.

By: Dr. Vivek Rana