Madhya Pradesh Chief Minister Mohan Yadav on Wednesday expressed gratitude to Prime Minister Narendra Modi, Union Home Minister Amit Shah and Union Jal Shakti Minister C.R. Paatil for their intervention in the decades-old Narmada water dispute.
Addressing the state Cabinet, CM Yadav said the long-pending dispute involving Madhya Pradesh, Gujarat, Maharashtra and Rajasthan witnessed a breakthrough following the Attorney General of India's opinion in February 2026 regarding the sharing of resettlement costs.
Earlier, Madhya Pradesh was facing a liability of around Rs 1,500 crore. Following a meeting held in New Delhi on Tuesday, it was decided that Gujarat would bear 75 per cent of the cost instead of 50 per cent, reducing Madhya Pradesh's share to Rs 217 crore.
CM Yadav shared these details during the Council of Ministers meeting, State Minister for Micro, Small and Medium Enterprises (MSME) Chaitanya Kumar Kashyap informed. Since the dam is located in Gujarat but its reservoir causes submergence in upstream states, the Narmada Water Disputes Tribunal (NWDT) was constituted to determine the sharing of the river's benefits and costs.
Despite the tribunal's award in 1979, disputes over cost-sharing arrangements, resettlement expenditure and compensation among the states remained unresolved for decades. The issue was finally resolved through the mediation of the Union Ministry.
The core dispute centred on the sharing of the substantial costs incurred towards land acquisition, construction borrowings, resettlement and rehabilitation (R&R). Under the final agreement, the historical liabilities have been substantially waived or restructured to facilitate a comprehensive settlement.
Madhya Pradesh had historically sought compensation of around Rs 7,669 crore for submergence-related impacts arising from the dam project. Under the final settlement, the Madhya Pradesh government will pay a one-time amount of Rs 217 crore to Gujarat to settle all pending mutual obligations.
As the principal beneficiary of irrigation and drinking water from the project, Gujarat bore the largest financial burden and can now proceed without any pending litigation relating to the dispute. Rajasthan, which also benefited from irrigation and agricultural development through Narmada waters, has likewise settled its cost-sharing obligations under the comprehensive agreement.
According to the original 1979 Narmada Water Disputes Tribunal (NWDT) Award, Gujarat was required to bear a substantial portion of the expenditure towards resettlement and rehabilitation (R&R) and land acquisition in the upstream states of Madhya Pradesh and Maharashtra.