ICRA Report: Interlinking River Projects to Unlock Rs. 80,000 Crore Business Opportunities in Four Years

According to a recent study by ICRA, significant business opportunities worth Rs. 80,000 crore are expected to emerge over the next four years from India’s interlinking river (ILR) projects. This is part of a broader forecast indicating that a total of Rs. 2.0 lakh crore in business potential will be available for engineering, procurement, and construction (EPC) players over the next decade.

The National Water Development Agency (NWDA) has earmarked 30 ILR projects, which include 16 peninsular and 14 Himalayan river links, with funding from the Government of India covering 60% of the costs, while the remaining 40% will be sourced from state governments. This initiative comes as part of the government’s intensified focus on the water sector, as evidenced by a significant budget increase for the Ministry of Jal Shakti, which has surpassed Rs. 78,000 crore for FY2025, reflecting a 69% compound annual growth rate (CAGR) over the last six years.

Chintan Lakhani, Vice President and Sector Head – Corporate Ratings at ICRA, emphasized the importance of the four priority projects—Ken Betwa, Kosi-Mechi, Parbati Kalisindh Chambal, and Godavari-Cauvery. He noted, “While the share of these projects in the ministry’s budget is currently minimal, it is expected to grow as more projects receive approval and construction gains momentum.”

The total estimated cost for the completion of these priority links is projected at Rs. 2.6 lakh crore by FY2035. The Godavari-Cauvery link stands out as the most expensive, accounting for 45% of the total project costs, while the Kosi-Mechi link is the smallest, making up 4%. The Ken Betwa project, which has already begun implementation, represents 21% of the total costs for these priority projects.

Lakhani also highlighted that although the Parbati Kalisindh Chambal and Godavari-Cauvery links are nearing the finalization of their detailed project reports, consensus-building among the affected states remains a significant hurdle for the successful execution of these ILR projects.

As the Indian government continues to push for advancements in water management and infrastructure, these interlinking river projects promise to play a crucial role in enhancing irrigation, managing water resources, and generating substantial economic opportunities in the coming years.