Vedanta’s takeover of Jaiprakash Associates raises concerns over SLBC tunnel project

Vedanta’s takeover of debt-ridden Jaiprakash Associates with a Rs 17,000 crore bid has raised doubts over the timely completion of the SLBC tunnel, the world’s longest irrigation tunnel, already delayed by a roof collapse and geological challenges.

Hyderabad: Hyderabad: Vedanta Group’s Rs 17,000 crore bid to acquire Jaiprakash Associates (JAL), outpacing Adani Group’s offer, has sparked uncertainty about the future of the Srisailam Left Bank Canal (SLBC) tunnel project.

The world’s longest irrigation tunnel, intended to irrigate 4,00,000 acres and provide drinking water to 516 villages in Telangana, faces delays following a roof collapse on February 22, 2025. Eight workers went missing after the incident, with only two bodies recovered while six remain untraced in the tunnel.

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The project, with 9.6 km of the 44-km tunnel left to complete, is at a critical stage. The December 9, 2027 deadline set by the Congress Government to coincide with the birthday celebrations of Sonia Gandhi now hangs in balance.

Vedanta’s acquisition of JAL, which entered insolvency proceedings on June 3, 2024 after defaulting on Rs 57,185 crore in loans, comes amid concerns about its track record.

This is raising doubts about its ability to manage JAL’s diverse assets, including the SLBC project. Adani Group, a strong contender for JAL, was seen as a potential bidder due to its infrastructure experience, despite its own financial controversies.

The SLBC project, plagued by geological risks flagged in a 2020 Amberg Tech AG report, requires advanced technical expertise to deal with the damaged Tunnel Boring Machine and unstable terrain. Vedanta’s approach to the execution of the remaining stretches of the SLBC tunnel is now the most talked about subject in irrigation circles.