India, March 10 -- The long-awaited Gargai dam project, meant to augment Mumbai's water supply by 440 million litres per day (MLD), has moved a step closer to reality. A Rs.5,396-crore proposal will be placed before the Brihanmumbai Municipal Corporation's (BMC's) standing committee on Wednesday for sanction, according to officials aware of the developments.

Two companies have bid for the project, officials said. Hyderabad-headquartered Soma Enterprise quoted Rs.3,334 crore, while Mumbai-based Hindustan Construction Company submitted a bid of Rs.3,493 crore. Both bids are higher than the BMC's estimate of Rs.3,006 crore.

Apart from construction costs, the project includes substantial expenditure on rehabilitation and environmental measu...