BBMB Dispute: Punjab Nears Agreement on Centre’s Formula to Settle Power Dues

The Centre on Wednesday told the Supreme Court that the Punjab government is close to agreeing to its proposal for settling outstanding dues related to the Bhakra Beas Management Board (BBMB) projects. The Centre said the long-standing dispute between the partner states could be resolved soon. Attorney General R. Venkataramani, appearing for the Centre before a bench headed by Chief Justice Surya Kant and comprising Justice Joymalya Bagchi and Justice V. Mohana, said that all sides were now broadly on the same page and that the remaining differences would be resolved shortly. The Supreme Court has fixed August 20 for the next hearing in the matter. Centre Proposes Settlement Through Power Instead of Cash According to the proposal placed before the court, the outstanding dues owed to Himachal Pradesh would be settled through electricity rather than a cash payment. The move follows the failure of the states to reach an agreement on the applicable electricity rate. Under the proposed cashless formula, Punjab and Haryana would provide electricity units to Himachal Pradesh against its pending dues. Himachal Pradesh, in turn, would not have to make payments to Punjab and Haryana, with the relevant amount to be adjusted against the electricity dues. The BBMB has been providing Himachal Pradesh its 7.19 per cent share of power from the Bhakra Beas projects since November 1, 2011. However, according to the information presented in the case, 13,066 million units of electricity from the earlier period remain outstanding. The Centre's proposal envisages providing Himachal Pradesh more than 12,000 million units of electricity towards the pending dues. ₹420 Crore Capital Cost Also Proposed for Adjustment Under the proposed arrangement, Himachal Pradesh would also not have to pay ₹420 crore towards the capital cost payable to Punjab and Haryana. This amount would instead be adjusted against the outstanding electricity dues. The proposal has raised hopes of a resolution to the dispute over Himachal Pradesh's share in the Bhakra Beas projects, which has continued for several decades. Supreme Court’s 2011 Decision The dispute over the distribution of assets and power shares between the states dates back to the period following the Punjab Reorganisation Act, 1966. After the issue remained unresolved for decades, Himachal Pradesh approached the Supreme Court in 1996. On September 27, 2011, the Supreme Court fixed the shares in the BBMB projects at 7.19 per cent for Himachal Pradesh, 51.80 per cent for Punjab, 37.51 per cent for Haryana and 3.50 per cent for Chandigarh. Himachal Pradesh Chief Minister Sukhvinder Singh Sukhu had earlier said that the Supreme Court had clearly recognised the state's 7.19 per cent share in the BBMB projects nearly 15 years ago. Despite this, he said, Himachal Pradesh had been deprived for more than a decade of its share of electricity and associated financial benefits. Sukhu had also stated that the state had been deprived of 13,066 million units of electricity and financial benefits estimated at around ₹4,200 crore, and that the Himachal Pradesh government was pursuing legal remedies to recover these dues. Next Hearing on August 20 With the Centre now stating that Punjab is close to accepting the proposed formula, the long-running BBMB dispute could move towards a settlement. The Supreme Court will consider the matter further at its next hearing on August 20.