Srisailam Left Bank tunnel faces delays as contractor JP Associates battles insolvency

The Srisailam Left Bank Canal Tunnel project, intended to bring Krishna River water to Mahabubnagar and Nalgonda, remains stalled following a fatal roof collapse and the insolvency of contractor Jaiprakash Associates Ltd. Despite partial progress, a critical nine-kilometre stretch remains incomplete.

Hyderabad: The Srisailam Left Bank Canal tunnel, a source of hope to bring water from the Krishna river to the dry fields of Mahabubnagar and Nalgonda districts, now hangs in the balance.

Though the State announced plans to finish it ahead of the latest deadline of December 9, 2027, the project, already stalled by a tragic roof collapse that killed two workers and left six others missing, is caught in the web of the financial overhaul process of its contractor, Jaiprakash Associates Limited (JAL).

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The tunnel ceiling caved in, burying eight labourers underground on February 22. Rescue teams from several agencies worked for weeks and managed to recover the bodies of two men. The rest disappeared under the debris, not found to this day.

Groundwork has come to a standstill. The State government had promised to resume excavation by July but the plans did not align with the ground reality.

The tunnel boring machine was damaged beyond repair. So far, teams have completed work on a major portion of the tunnel, but a tough 9-km section that needed careful handling to prevent another disaster, still remains incomplete.

Officials say digging will pick up again once the monsoon eases, likely by late October. Sources close to the project management say the real holdup isn’t the tough terrain. It’s JAL’s long-drawn legal battle in court with lenders over unpaid debts.

The company has fallen into insolvency, with creditors holding claims of roughly Rs 55,000 crore. They’ve spent months in talks over bailout plans. Vedanta Group seemed to lead the pack in early September with a Rs 17,000 crore bid. But the banks involved seem to be keen on concrete plans.

The Committee of Creditors had their 21st round of talks on October 6, and a vote on the top proposals could come any day now. To seal the deal, it needs approval from two-thirds of them.

Insiders say the State is keen on keeping JAL to continue the project implementation in view of the huge financial support extended to it during the critical phases and the latest tunnel roof fall crisis.

“We can’t switch contractors now,” one official said quietly.

Meanwhile, engineers from the National Geophysical Research Institute (NGRI) are gearing up for aerial magnetic surveys to spot weak spots in the rock and map out any needed reroutes.