Rao, who held a review on Water Grid, said drinking water should be supplied first to the fluoride-hit Nalgonda district and the drought-hit Mahabubnagar district, a release from the Chief Minister's Office said.
Noting that HUDCO and NABARD would invest Rs 13,000 crore, he said the organisations may invest another Rs 7,000 crore.
Observing that the Centre would also provide funds for the project, Rao said the state government is also ready to provide money wherever necessary.
Rao, spoke to the General Manager of South Central Railway regarding permissions for laying the pipelines of the grid where railway lines are in the way.
The officials of state government and the railways would hold a meeting on the issue, the release added.