Here are 10 developments in this big story:
The project is expected to irrigate 45 lakh acres and help produce two crops a year. It will also cater to the drinking water needs of 70 per cent of the state. An approximate 16 thousand million cubic feet (TMC) will support industries.
The project will see at least 2 TMC of Godavari water lifted daily to the Medigadda Barrage and then transported via six more levels to Konda Pochamma Sagar Reservoir, which is located approximately 60 kilometres from Hyderabad.
KCR's invitation to his Andhra counterpart is significant because the two states had resolved to amicably solve disputes arising from sharing of Godavari and Krishna waters. One of the key reasons for the split of former Andhra Pradesh into two states was distribution of water.
Telangana Congress had demanded Mr Reddy not attend as the project was conceptualised during the rule of his father, former Chief Minister YS Rajasekhar Reddy, in 2004 as the Pranahita-Chevella project. KCR re-engineered and re-designed the project after he became Chief Minister.
Mr Fadnavis had been invited after Maharashtra extended its cooperation for the construction of the project. In 2016, the two states signed agreements to solve inter-state disputes, paving the way for the mega project.
KCR last week skipped the Prime Minister-led Niti Aayog meet in New Delhi because he was busy with preparations for today's inauguration ceremony. The meet was the planning body's first following election results last month.
Asked on Tuesday why Prime Minister Narendra Modi had not been invited, KCR pointed out that his party was not part of the ruling National Democratic Alliance (NDA) and said that while an invitation to an earlier event had been extended, he did not plan to invite PM Modi for all state functions.
Proposed benefits include increased agriculture yield, crop guarantee and commercial farming of fish. The government has also claimed the project will help eradicate poverty and improve health and socio-economic conditions of farmers.
According to official statistics the project features the world's biggest and largest underground pumping stations. In addition, an 81 kilometre long tunnel connecting Yellampalli Barrage and Mallanna Sagar Reservoir is nearing completion. The total length of canals, tunnels and pressure pipeline stands at 1,832 kilometres.
The project has been criticised by opposition parties in the state who have alleged inflated costs. M Bhatti Vikramarka, leader of the opposition in the state assembly, last week claimed the actual cost of the project was Rs 1 lakh crore. Telangana state BJP leader Bandaru Dattatreya mocked the KCR for inaugurating a project when it was only 20 per cent complete.
With inputs from PTI, ANI