Faced with a wave of religious sentiment about the Ganga, as well as activists clamouring about environmental damage, the Union government has reversed its position on the Loharinag Pala hydel project. The 600 MW dam, being constructed by the NTPC Limited on the Bhagirathi near Uttarkashi in Uttarakhand, will be scrapped.

It has also been decided to declare the 135-km stretch between Gomukh and Uttarkashi as an eco-sensitive zone under the Environmental Protection Act. Once the change is made in the next few weeks, no development projects will be allowed in the zone.

The decision was taken by the same three-member Group of Ministers — Finance Minister Pranab Mukherjee, Power Minister Sushil Kumar Shinde and Environment Minister Jairam Ramesh — who recommended in June that the dam could not be scrapped due to the financial implications involved.

The NTPC had invested Rs.650 crore in the project, while orders worth more than Rs.2,000 crore have been placed. However, protesters — ranging from environmentalists and academics to Hindu devotees and local villagers — have met both Prime Minister Manmohan Singh and Mr. Mukherjee to plead their case.

Following “wide-ranging consultations,” Dr. Singh asked the GoM “to reconsider its earlier decision.” On the basis of a re-examination on Friday, the GoM decided that the social and environmental costs outweighed the financial costs and recommended that the project, now under suspension, be scrapped.

Two other hydel projects on the river were scrapped in March.

A technical committee will be set up to recommend dismantling and safeguard measures to protect the eco-geological balance of the area. It will also determine the NTPC's losses. The GoM recommended that the Union government also compensate the NTPC and bear the cost of maintaining the safeguards.

Mr. Shinde said all PSUs under his Ministry have been warned to keep the cumulative environmental impact in mind when planning future power projects and to ensure that no construction began until final clearances. However, he said, nothing could be done about the projects that have been cleared and begun construction already.

More In: National | News