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Home › October 2013
New Delhi: The government will soon constitute a panel, headed by PMEAC Chairman C Rangarajan, to look into the issues pertaining to bailout of highway developers.Rangarajan, who heads the Prime Minister’s Economic Advisory Council, is expected to announce the constitution of the three-member panel soon, a source told the agency, adding that it could be as early as Thursday.
The government last week approved a proposal for the postponement of premium payments by highway developers and has referred the matter to the Rangarajan panel.
The move is likely to provide relief to players such as GMR, GVK and Ashoka Buildcon. Their projects have been facing delays on account of high premium — the payment made by the developer to National Highways Authority of India under the build, operate and transfer (BOT) mode.
The premium, which is offered by companies during the bidding stage, is based on projected returns from tolls.
The Ministry of Road Transport and Highways had sent a proposal to the Cabinet seeking its nod for rescheduling of premiums of about Rs 1 lakh crore in case of 23 awarded BOT (Toll) projects.
Source-
Subir Bhaumik
(Beijing hopes that India…)
During Chinese Premier Li Keqiang’s India visit in May, India agreed to “explore the possibilities of the proposed Bangladesh-China-India-Myanmar (BCIM) economic corridor” with China. But New Delhi is going slow on this. When Prime Minister Manmohan Singh visits China this month, the Chinese will push for the BCIM plan. China has already been in discussion with Myanmar and Bangladesh to take this forward. During Singh’s Beijing visit, China will also offer to declare Kunming and Kolkata as sister cities to carry forward the process.
It is New Delhi and not states in the east or north-east that fear Chinese trade and investments along the corridor. This trade can only boost their economies. The opening of the Stilwell Road, built during World War II, is a case in point. Assam’s industry minister Pradyut Bordoloi and Arunachal Pradesh’s former governor J J Singh have been enthusiastic about opening the road to China-India trade. Unlike the Nathu La pass in Sikkim, the Stilwell Road is capable of handling 20-25 per cent of Sino-Indian bilateral trade. But a powerful defence-commerce ministry lobby has blocked it all these years.
China has modernised its part of the road and its companies are doing that in Myanmar now. Only 66 km of the road falls in India — so, if the Chinese army uses it to amass troops on the Indian border for a surprise offensive or dump their products in a trade war, they can do it even if India does not formally open the road. Also, trade with India via Arunachal Pradesh will immediately stop all claims of that region as “southern Tibet”.
Note how quickly China shed its reservations on Sikkim, after trade resumed through the Nathu La pass. JJ Singh, a former army chief, advocated an Indian presence on the road for pragmatic reasons, but that did not help with the mandarins in Delhi. So, an alternate route was chosen for the BCIM car rally in February-March: it started at Kolkata, passed through Bangladesh and India’s north-eastern states of Assam and Manipur, and ended in Kunming, Yunnan via west and north Myanmar.
Now, China wants the car rally route to be converted into the BCIM Friendship highway and turned into an economic corridor with industries, trading entrepots and tourism infrastructure developed around it. This is an excellent idea. Large parts of China, contiguous with south Asia, are landlocked. The Strait of Malacca is a choke point that China wants to bypass through overland trade through Myanmar, Bangladesh and the north-east. Beijing wants to transform BCIM into a live regional grouping to integrate the two most populous nations of the world and use the Bangladesh-Myanmar corridor to help Chindia draw south-east Asia into the world’s strongest future economic bloc. Beijing hopes that India sheds its fear of encirclement by China and creates a win-win situation for both countries in Asia, from south-east to west.
India, especially its eastern and north-eastern states, would stand to gain much more economically by higher trade and connectivity with China and the rest of Asia. On the other hand, there is no material gain if India acts as a pivot for American interests in south Asia.
A formal push for the BCIM during Manmohan Singh’s China visit may boost investments and help chief ministers or industry ministers in the east and north-east to showcase their states to Chinese investors. If the home ministry can waive its objections and agree to allow Chinese telecom majors like Huawei to invest in the Delhi-Mumbai Industrial Corridor or the Indian embassy in Beijing can rope in huge Chinese investments for Andhra Pradesh, the east and north-east should not be deprived because the region has a long border with China.
Source-http://articles.economictimes.indiatimes.com
Pics: Dayanand Kukkaje
Daijiworld Media Network – Mangalore
Mangalore, Oct 17: “The National highway from Pumpwell circle till Talapady (Kerala border) is poorly maintained and we find many potholes creating trouble for people. Looking at the overall condition as no repair works are undertaken in this road, it looks like there is a mutual understanding between the NHAI with the Navayug Udupi toll way private limited who are in-charge of it said advocate S S Khazi.
Speaking to the media on Thursday October 17, he said the NHAI had given the tender to Navayug company in 2010 with two main responsibilities, that is to undertake four lane work and maintain the old roads for which Navayug company will be allowed to collect toll money from vehicles for 25 years. As per the contract, until the four lane work is done, Navayug company has to main the old roads as well.
“Even after obtaining the contract 3 years back, not even 10 % of the road widening work is done nor are the roads maintained properly. The above instance shows that the crores of money sanctioned are looted by the company and NHAI, after having a secret understanding between themselves,” he said.
“I had also raised a few questions before the highway authority about the bad roads through RTI for which the authority were not specific in giving answers and tried to deviate the points raised. Even after highway authorities knows that the company has not undertaken any work, they do not take any actions,” he said.
“Officials promise people stating that very soon they will have beautiful pothole – free roads. But in reality the money sanctioned for the work is gulped by them. As a compensation for my travelling loss in these roads, I have sent a legal notice to the authority demanding compensation of Rs 5 lac which should be met in 60 days. If it is not fulfilled then I will step court,” he said.
“My fight is not for my personal benefit, instead my duty is to give good roads to the city,” said advocate and assured his support to people whoever raises their voice in this regard.
Source-http://www.daijiworld.com
Written by ITW Editor · Filed Under NHAI
Activist moves HC, claims NHAI formula gives figures lower than those collected
The recent incident of firing at Khed Shivapur toll plaza has brought in the spotlight the ugly face of toll collection once more. A city-based right to information (RTI) activist has, in fact, moved the Bombay High Court claiming that the toll colleted at various toll plazas are much more than what should be charged.
City-based activist Sanjay Shirodkar has claimed that the state government is not following the formula specified by the National Highway Authority of India (NHAI) while specifying the charges at toll plazas in the state.
Shirodkar told dna, “I have already filed two public interest litigations in the Bombay High Court regarding toll. One of the PILs is about wrong formula applied by the state government while charging toll, due to which commuters have to pay more than what they should actually be paying.”
He added, “According to the resolution of the Central government, the toll should be charged on a formula which states that the base fee should be multiplied by wholesale price index of current financial year divided by wholesale price index of 1997. On the basis of this formula, the toll charges at Pune-Mumbai stretch of national highway number 4 should be Rs53 but the toll charges which are being charged are Rs87.”
Shirodkar has objected to the toll charges collected on Mumbai-Pune expressway.
He said, “There is a rule that if more than one lakh passenger car units (PCU) are passing through any highway in a day, the toll charges should not be increased. We have calculated PCU of Mumbai-Pune expressway on July 1, 2012 and the PCU was 1,18,469 and the next day it was 1,14,518 which suggests that the toll of Mumbai-Pune expressway should be increased from that day.”
dna contacted Ajay Saxena, who works with public private partnership cell of the state government. He said, “The problem with the toll is more regarding the services provided after charging toll. On some highways, it has been observed that toll is being charged but good quality of road is not provided to the commuters. Earlier, there were not many regulations, but recently the state government came up with regulations against toll collections agencies. According to those regulations, the agencies will have to provide quality service after charging toll from commuters or they will face action.”
The toll what it is, what it should be
Activist Sanjay Shirodkar calculated the toll that should be charged
Road Toll charges Actual toll
as per formula charges
Kagal-Satara Rs62 Rs 124
Anewadi (Satara)-Khed Shivapur Rs24 Rs50
Khed Shivapur-Pune Rs15 Rs70
Mumbai-Pune NH-4 Rs53 Rs87
Pune-Shirur Rs30 Rs37
Shirur-Ahmednagar Rs26 Rs35
Ahmednagar-Aurangabad Rs58 Rs75
Pune-Belgaum Rs167 Rs294
Source-http://www.dnaindia.com
Pic for representational purpose. – A Veeramani/DNA
After contemplating the idea of having an elevated road between Bandra and Dahisar, the Maharashtra State Road Development Corporation (MSRDC) now plans to build an elevated rail and road link between Thane and Kalyan.
Speaking todna, SM Ramchandani, the joint managing director of MSRDC, said, “There is a plan to have an elevated road along National Highway 3, that is the Thane-Bhiwandi Bypass Road, for which we have floated bids for consultancy services.”
The consultant is likely to be appointed by the end of this month, who in turn will carry out a feasibility study including a ground survey, cost estimation, financial model, among other things.
In fact, even the Indian Railways has expressed interest in being part of the project by stating that the elevated road corridor can also accommodate a railway line.
The planned elevated link will be around 22-25km long, with entry and exit ramps in between.
The purpose of the project would be to decongest the increasing traffic due to rising population in the far-flung areas of Mumbai.
The state has been focusing on creating new Central Business Districts in the Mumbai metropolitan region, keeping the larger picture of decongestion of Mumbai in mind. However, due to the large cost associated with this elevated rail and road project, it is unlikely that it will be constructed in the near future.
Another official said that the plan is currently in the nascent stage and it should not be considered that the project will take off in the next couple of years.
Source-http://www.dnaindia.com
Victor Dzüvichü Kohima |
A stretch of the Pezielietsie-Keyake road in Kohima has remained unrepaired for 10 years now. (Morung Photo)
Kohima might be the centre of Nagaland’s government enterprise, but its roads tell a different tale of governance. With the President of India geared to visit and take some of the disabling routes that connect Kohima city, and the city to other districts, work to touch some of them up has been promised to begin. For instance, news of the Pezielietsie –Keyake road stretch via Don Bosco Higher Secondary, Ziekezou, being repaired has arrived.
The Kohima Village Youth Organisation (KVYO) met Border Roads Task Force (BRTF) officials on October 14 to take up the repair of the road. Over the past 10 years KVYO has reportedly sent a number of written requests to the BRTF, by whom the road is maintained, to repair the damaged route but has been met with a standard response: the lack of funds. Though an old road, connecting Kohima to Phek and Kiphire, it has not been repaired for 10 years now. In that time, the KVYO has widened the road through private means though it could not be ‘black topped’.
Now, some government funds have been made available. While ‘metalling’ of the road will not be possible, according to BRTF officials, due to “no sanction of funds for the same,” the BRTF has promised to “cover up the bad patches with a mixture of stones and soil as soon as possible.”
The news of the repair works has brought some relief from the daily grime for people who have to regularly take this essential route, which includes students of Kohima College, Don Bosco Higher Secondary school, TM Govt. High School and Christ King School in addition to employees of the Department of Youth Resources and Sports.
“It is funny the road has been left unattended for so many years and now with news of the President taking this route, the BRTF is finally paying attention to it,” said a resident of Ziekezou colony, who wished not to be named. “We do not know whose fault the deplorable road condition is but we are happy that the road will be repaired after a long period.”
Another resident commented, “I regularly ply on this route to go to work; my vehicle has to be repaired every three months due to the bad road condition. I dread this road but am left with no choice,” adding, “It is like driving on a river bed; at times I feel like I am participating in an off-road event.” Officials of the KVYO, meanwhile, have appealed to the State Government to look into the matter, stating that they would also send appeal letters to other authorities concerned regarding the issue.
Written by ITW Editor · Filed Under Road
Gireesh P Krishnan, TNN |
KOCHI: The traffic police, National Highway Authority of India (NHAI), public works department (PWD) and related authorities have to make concerted efforts if they are to going to bring down road accident casualties in the city. Despite their tall claims, the city still witnessed a marginal increase in road accident deaths this year compared to the previous one till September. If road accidents claimed 109 lives in 2013 from January to September, it stood at 102 deaths for the same period last year.May turned out to be cruelest month for pedestrians and motorists this year with 20 dying on city roads. Last year, May in contrast reported only 10 road accident deaths. April was not far behind with 17 deaths reported this year compared with 15 the year before.
Though there has been an overall increase in accident deaths, it has decreased since July compared to the same period last year. While seven died in accidents in July against nine in 2012, it was 10 in August against 14 the previous year, and nine in September compared with 14 in 2012.
“A majority of those who died in road accidents this year were pedestrians. Lack of proper crossings and barricades have been a problem. To address the issue, we have conducted awareness programmes for private bus drivers and auto drivers,” said P P Shams, assistant commissioner, traffic east. He added that NHAI was asked to erect barricades on the median in the NH47 bypass, where most of the pedestrians died in accidents, and to restrict pedestrian crossings to selected points.
While around 40 pedestrians died in road accidents in the first nine months of the year, 20 two-wheeler riders and 15 pillion riders died till October. More people died in accidents that occurred during day time.
Even though accident deaths have gone up this year, there has been a marginal decrease in the number of road accidents. It has declined from 1,732 in 2012 to 1,718 in 2013. According to police, two-wheelers were involved in more than 500 reported accidents.
R-Infra joins growing number of firms selling assets in a slowing economy, appoints EY to oversee sale
P.R. Sanjai | Malvika Joshi
The R-Infra’s plan comes at a time when nearly 50 roads projects are up for sale in the country. Photo: Priyanka Parashar/Mint
Mumbai: Reliance Infrastructure Ltd (R-Infra), a part of the Anil Ambani-led Reliance Group, plans to sell either all or most of its 11 road projects to pare debt, according to three people familiar with the development, joining companies that are putting assets on sale to reduce their debt burden.
R-Infra has appointed consulting firm EY, formerly known as Ernst and Young, to oversee the sale, said the people, who didn’t want to be identified. The aim is to reduce some of the Rs.21,976.18 crore of debt it had on its books at the end of the last fiscal year.
R-Infra’s spokesperson declined to comment on the matter. An e-mail sent to EY on Friday did not elicit a response.
Two of the three people said EY is taking the projects, with a total length of 968km and on which R-Infra has spent around Rs.11,700 crore, to potential buyers and is yet to finalize their sale.
One of the three people is from R-Infra, another an investment banker and the third is with a private equity fund.
The plan comes at a time when nearly 50 roads projects are up for sale in the country as infrastructure companies building them struggle with problems including delayed government approvals, land acquisition hassles and a funding crunch in the face of high borrowing costs.
Slower economic growth, which slumped to a four-year low of 4.4% in the fiscal first quarter, has caused road traffic to decline, putting the viability of road and highway projects in doubt.
The asset sales are not limited to road projects. Many infrastructure firms are disposing of assets. Since January, at least 10 Indian companies have either sold or announced the sale of assets in a bid to pare Rs.3.58 trillion worth of debt, according to Mint research and an August report by Credit Suisse Securities Research and Analytics.
In an interview with Mint earlier this month, Reserve Bank of India governor Raghuram Rajan welcomed the asset sales.
“We need more of that,” Rajan said. “Because it’s not that the system as a whole doesn’t have liquidity. There are companies sitting on tonnes of cash. Could they buy from these guys? Could foreign investors come in?…”
“If the liquidity-strapped entities get financial space once again, they can then start bidding for projects; they can start fulfilling some of their past commitments,” Rajan said.
Around 40-50 road assets are currently on the block, said Sandeep Upadhyay, senior vice-president (infrastructure solutions group), Centrum Capital Ltd.
Assets that are already operational are commanding a premium, but those still at various stages of development are being valued at a discount, said Upadhyay.
Out of 11 R-Infra road projects, nine are operational.
Operational road projects are cash-generating and have lower risk attached to them. Despite the projects being operational, investors are not rushing to buy these assets as the traffic on the roads is lower than projected before construction.
“Most of the road assets across the country are struggling as the traffic and expected returns were projected aggressively in most cases. This is the reason that while investors have appetite for good assets, there is a wide gap between bid and offer prices,” said Vikas Khemani, head of institutional equities at Edelweiss Securities Ltd.
Mint spoke to executives at least two infrastructure investment companies that had evaluated R-Infra’s road projects. They are yet to take a call on buying them because of a mismatch in valuations.
Investment in the road sector has fallen sharply. According to VCCEdge, which tracks investments, private equity deals (PE) worth $123.5 million have been struck since January in the road sector. In 2012, two deals were struck for $131 million and, in 2011, three big-ticket PE deals worth $556 million were struck.
In May, UK-based PE firm Actis ended its three-year old road joint venture with Tata Realty and Infrastructure Ltd. Actis held a 35% stake in the $2 billion venture.
“In most of the road projects, the internal rate of return is not matching the developer’s expectations,” Khemani of Edelweiss Securities said, adding that while many road assets are up for sale, only a few transactions are materializing.
Upadhyay of Centrum Capital said infrastructure firms’ aggressive bidding for road projects had led to over-leveraged balance sheets, hurting their financial closure prospects.
“The current situation has been primarily self-inflicted due to indulgence in aggressive bidding, based on overestimated traffic growth assumptions and failure to achieve optimistic completion timelines,” he said.
Another investment banker, on condition of anonymity, said several road projects are generating single-digit returns.
For companies primarily focusing on the EPC (engineering, procurement and construction) model and not wanting to wait for 15-20 years to generate returns, strategic sales are an obvious choice, Upadhyay said. This helps them reduce debt and invest the money in other projects.
“For those relying on BOT (build, operate and transfer) model, the picture may not be as gloomy as is currently perceived,” he said. “This is a buyer’s market and there is ample opportunity to cherry-pick quality assets, ensuring decent—16-17%—returns,” Upadhyay said.
Dipak Kumar Dash, TNN |
NEW DELHI: The Cabinet is likely to clear a proposal on Thursday for construction of a 15-km tunnel at Zojila pass in Ladakh region. Sources said that the proposal — put forth by the road transport and highways ministry — envisages construction of an all-weather road involving Rs 9,090 crore investment, ensuring undisrupted round-the-year connectivity between Ladakh and Srinagar.Highway ministry officials said that the construction of the tunnel will need at least seven years, and the contract for collecting toll will be for 15 years.
Congress vice-president Rahul Gandhi had promised to people of Leh and Ladakh to provide all-weather connectivity to the rest of the country during UPA’s rule. Last year, he had laid the foundation stone for the 6.5 km Z-Morh tunnel in this region involving nearly Rs 2,700 crore. This project is scheduled to be completed in five years. Sources said that the project developer, however, is yet to tie up funds for construction.
The Zojila pass is situated at an altitude of 11,578 ft on the Srinagar-Kargil-Leh National Highway (NH-1), which remains closed from December to April. It is not feasible to keep the road clear during winter due to heavy snowfall, and to make matters worse the area is prone to severe avalanches.
The project involves construction of a two-lane and bi-directional tunnel with an escape route. The project will be constructed on annuity mode, where government will pay back the private developer’s investment in installments once the stretch becomes operational.
Vivek Waghmode, TNN |
KOLHAPUR: The city has come under a thick security blanket with police making elaborate arrangements to avoid any untoward incident during Thursday’s protests by the Kolhapur Anti-Toll Committee in protest against the government’s decision to go ahead with collection of toll on the inter-city roads.
Around 700 policemen with 150 sub-inspectors and inspectors, three officers in the rank of the deputy superintendent and a one company of State Reserve Police Force have been deployed at the vulnerable points, including nine toll plazas, in the city.
Superintendent of police Vijaysingh Jadhav on Wednesday said, “According to the high court’s order, we will provide protection to the IRB Company for toll collection. There are nine toll plazas in the city and the police will be deployed at all the booths from Thursday. Our duty is to maintain law and order and we are well prepared. We will arrest anybody trying to violate law and order situation or create any kind of disturbance that may affect law and order situation in city. Those arrested will be kept at Yerawada jail because the two jails in the district Kalamba jail and a sub-jail at Bindu chowk are full to their capacity.”
He had called a meeting of all police officers and asked them to take strict actions against those trying to trespass or loiter around toll plazas in groups. The district administration has already issued prohibitory orders and Jadhav has asked the police to take action against anybody violating the directives.
The Bombay high court had directed the state government and the district administration to provide police protection to M/s IRB Kolhapur Integrated Road Development Company to start toll collection in the city.
The IRB had filed a writ petition (6646/2013) in the high court to seek an appropriate writ, direction and order and direct the state government and the police department to provide adequate protection for toll collection. The court asked the state government and the police department to ensure protection at each toll plaza and all other establishments under the Kolhapur Integrated Road Development Project.
A high court bench of Justice V M Kanade and Justice S C Gupte passed the order on September 26 and has scheduled the next hearing on October 21.
The police, in a letter dated May 23, 2013, had expressed their inability to provide immediate police protection, because a large police force would be required for the purpose.
Source-http://timesofindia.indiatimes.com
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