Maharashtra Minister for Water Resources Sunil Tatkare and his Madhya Pradesh counterpart Jayant Malliya decided in-principle to initiate the project in a joint venture.
"While Madhya Pradesh government will construct the project, Maharashtra will bear the cost for the same. A 90 MW hydel electricity project will also come up at Jamghat and the power generated will go to Madhya Pradesh," Tatkare told a press conference here.
BJP national president Nitin Gadkari, local MLA Davendra Phadanvis and Mayor Anil Sole were present at the function.
As per the agreement, Maharashtra will receive 10 billion cubic feet of water from the irrigation project, post power generation, between October 15 and June 30 every year, Tatkare said.
While nine billion cubic feet water will be given to Nagpur Municipal Corporation (NMC), one billion cubic feet of water will be utilised for irrigation purposes, he said.
The inter-state meeting also discussed construction of irrigation dams on Sone and Deva rivers in Madhya Pradesh on the basis of sharing of water and cost.
Next meeting of Jamghat project will be held in Bhopal on September 8 and a detailed project report will be prepared later, Tatkare said.