Four States Sign Narmada Project Payment Pact

Four Indian states, Madhya Pradesh, Gujarat, Rajasthan and Maharashtra, signed an agreement in New Delhi on 7 July 2026 to settle a long-running payment dispute linked to the Narmada project. The pact covers cost-sharing issues for the Sardar Sarovar Project and the Indira Sagar Project, both associated with the Narmada Water Disputes Tribunal Award.

Narmada Water Disputes Tribunal

The Narmada Water Disputes Tribunal was constituted under the Inter-State Water Disputes Act, 1956, to adjudicate disputes over the Narmada river system. The tribunal’s award covered water allocation, project construction, and related obligations among the basin states.

Sardar Sarovar and Indira Sagar Projects

The Sardar Sarovar Project is a major multipurpose river valley project on the Narmada river in Gujarat. The Indira Sagar Project is a large reservoir and hydropower project on the Narmada river in Madhya Pradesh, and both projects involve inter-state financial and rehabilitation obligations.

Settlement Terms and State Participation

The agreement addresses dues related to Resettlement and Rehabilitation expenditure, compensation for submerged land, and interest on construction borrowings. Maharashtra’s Chief Minister Devendra Fadnavis stated that claims of ₹2,000-₹3,000 crore against the state were waived and that Maharashtra will pay ₹27 crore.

Important Facts for Exams

• The Narmada river flows through Madhya Pradesh, Maharashtra, Gujarat and Rajasthan before reaching the Arabian Sea.
• The Sardar Sarovar Project is one of India’s best-known inter-state river valley projects.
• Resettlement and Rehabilitation, often written as R&R, is a standard component of large dam projects in India.
• Inter-state water disputes in India are governed by the Inter-State Water Disputes Act, 1956.

Recent Inter-State Water Agreements

The Narmada pact follows recent agreements on the Yamuna Water Project between Rajasthan and Haryana on 29 June 2026 and the Kishau Multipurpose Project on 16 June 2026. Union Home Minister Amit Shah and Union Jal Shakti Minister C.R. Patil were present at the signing ceremony.