Government of India declared 14 projects as National Projects in February 2008. Subsequently, one more project Saryu Nahar Pariyojana of Uttar Pradesh has been included in the scheme of National Projects in 2012. As per the Guidelines of National Projects, the projects are eligible for 90 per cent grant of the balance project cost (cost of work) of irrigation and drinking water components of the project.    

At present, the scheme of National Projects is being funded from the allocation as available under the Accelerated Irrigation Benefits Programme (AIBP). The State Government of Madhya Pradesh had submitted the proposal of Bargi Diversion Project for inclusion in the scheme of National Projects in December, 2009 to Ministry of Water Resources (MoWR).    

The project was recommended for inclusion as National Project by the High Powered Steering Committee of Ministry of Water Resources in February, 2010. A new project is declared as national project after ascertaining its eligibility for assistance, which includes investment clearance from Planning Commission, clearance from Expenditure Finance Committee (EFC) /Project Investment Board, recommendation of the High Powered Steering Committee and approval of Union Cabinet.    

The EFC clearance and the Cabinet approval is not available for Bargi Diversion Project of Madhya Pradesh for declaration as a National Project.