Mumbai Infra News: Gargai Dam Proposal Cost Slashed After Review, BMC Saves ₹344 Crore

Mumbai: After the standing committee raised concerns and returned the Gargai dam proposal, the contractor revised its bid from 9% to 1.9%. The civic authorities will now submit updated proposal, generating savings of Rs 269 crore on the base cost and Rs. 344 crore including taxes. The project, quoted at Rs. 3,276 crore, is now proposed at Rs. 3,065 crore, reducing the total cost including taxes from Rs. 5,396 crore to Rs. 5,051 crore.

The BMC initially estimated the Gargai dam project in Ogada village, Palghar district, at Rs. 3,006 crore. When tenders were invited in December, the lowest bidder, Soma Enterprises Ltd., quoted Rs. 3,334 crore, later reduced to Rs. 3,276 crore after a Rs. 57.73 crore concession—about 9% above the estimate, down from an initial 10.9%. However, the standing committee sought further cuts, the BMC held three more rounds of negotiations over the past two weeks, resulting the contractor to lower the cost further. 

The civic authorities will now submit the revised proposal to the standing committee for final approval. After the work order is issued, the project will still require clearances from the Central Wildlife Board and state and central forest departments. "The first year will focus on securing permissions and creating infrastructure to relocate six affected villages, followed by dam construction in the second year and installation of electrical systems in the third year," said a senior civic official. The project includes a 1,200 kW hydropower unit to offset the dam’s electricity costs.

The Gargai Dam Project in Wada taluka, Palghar, aims to boost Mumbai’s water supply by 440 MLD. It involves constructing a 69‑metre-high dam near Ogada village and a 2.2 km tunnel to divert water to the Modak Sagar Reservoir. Implementation will require felling around 3.1 lakh trees, including areas within the Tansa Wildlife Sanctuary, necessitating compensatory afforestation on non-forest land. The project is expected to be completed by 2029.

The BMC supplies 4,000 MLD of water to Mumbai from seven lakes—Tansa, Bhatsa, Modak Sagar, Tulsi, Vihar, Upper Vaitarna, and Middle Vaitarna—but 34% is lost to theft and leakages. Rising pollution and urbanisation have pushed demand to 4,463 MLD, expected to reach 6,900 MLD by 2041. The last major dam, Middle Vaitarna, was completed in 2014. 

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