Around 2.5 lakh people living in slums on the eastern fringes outside Tata Steel lease area in Jamshedpur will get Jusco's drinking water from April.

Chief minister Raghubar Das, after launching the 2km-long newly widened Tinplate-Kadani Road at Baridih Postal Park, said a formal agreement on this would take place between the state government and Tata Steel this month.

"We have held talks with the steel major which has agreed to supply drinking water to urban slums facing severe water crisis especially during summer. It will be done via cost sharing basis between the government and Tata Steel on a 60:40 ratio. Once the agreement is final, water supply will start from April," said Das.

The Rs 28-crore Moharda drinking water project, the pet project of the chief minister, is yet to be fully operational. After the agreement, Jusco, the wholly-owned subsidiary of Tata Steel, will supply drinking water using the infrastructure of Moharda project to nearly 2.5 lakh people living in the slums of Birsanagar, Baridih, Bagunnagar, Bagunhatu and Luabasa.

The Moharda project has seven water towers, a filtration-cum-treatment plant and an intake well from Subernarekha with a capacity to provide 5.5 million litres.

The chief minister also announced Jusco would supply electricity to these slums.

"An agreement in this regard will be reached between the government and Tata Steel soon. But, for power and drinking water, slum dwellers will have to pay tariff," Das added.

Till now Jusco used to provide electricity only to Tata Steel lease areas while urban slums outside the lease area used to get power from state owned Jharkhand Urja Vidyut Nigam Limited (formerly JSEB) with residents complaining of erratic supply.

Earlier on Tuesday morning, the chief minister, with Tata Steel vice-president (corporate services) Sunil Bhaskaran and Jusco MD Ashish Mathur, inaugurated the 2km Tinplate-Kadani Road.

The road has been repaired and widened at a cost of nearly Rs 5 crore. The 2km stretch, which has gone from two-lane to four-lane in a span of one year, has doubled its width from 7m to nearly 15m, and connects Tinplate roundabout to densely populated localities like Baridih and Birsanagar.

Before leaving for Ranchi the chief minister said: "We have allocated Rs 4,000 crore for road construction. By 2017, there will be a network of good roads in the state."