Update on NHAI expressways projects

It is reported that, with access controlled expressways attracting massive investments, ministry of road transport & highways has decided to conduct the feasibility study for more such expressways and construction companies eyeing the access controlled expressway projects of National Highways Authority of India are likely to get investment opportunities for at least 4 such projects spread over 495 kilometer over the next few months. They are1) 70 kilometer Chandikhol Jagatpur Bhubaneswar – INR 761 crore2) 47 kilometer long Delhi Hapur – INR 474 crore3) 198 kilometer long Vijayawada Elluru Rajamundri – INR 1,602 crore4) 180 kilometer long Delhi Agra highway – INR 1,918 croreThe feasibility reports for these projects are already completed and the work is likely to be awarded in about 6 months. These projects are for widening the current 4 lane highways into 6 lanes and operating them for certain durations. Companies would have to bid competitively for these projects on a revenue sharing basis. Thus companies would have to bid on the extent of toll revenue that they are ready to share with the Government if they are allowed to operate the roads. Since these highways are already 4 lane stretches, the road operators can start toll collection even during the project construction phase from an appointed date, mutually decided by NHAI and the road operator. The toll revenues will be routed to an escrow account.Recently, NHAI has awarded 4 such mega projects of 882 kilometer length, which are likely to cost an estimated INR 10,912 crore. From the NHAI perspective, these projects have emerged as money spinners, with companies willing to foot the entire construction cost and part with 2% to 48.06% of their revenues in the initial leg of the project. At the end of the concession period, which is about 12 to 15 years duration, the winning firms have agreed to part with 12% to 59% share of toll revenues.The feasibility reports for another 10 projects of similar nature are under preparation. They are1) 315 kilometer long Kishangarh Udaipur stretch – INR 2,205 crore2) 235 kilometer long Udaipur Ahmedabad – INR 1,645 crore3) 190 kilometer long Varanasi Aurangabad – INR 1,330 crore4) 184 kilometer long Nellore Chilkaluripet – INR 1,288 crore5) 148 kilometer long Krishnagiri Walajapet – INR 1,036 crore6) 145 kilometer long Pune Satara – INR 1,015 crore7) 85 kilometer long Ludhiana Chandigarh – INR 595 crore8) 80 kilometer long Belgaum Dharwad – INR 560 crore9) 56 kilometer long Samakhiali Gandhidham – INR 392 crore10) 55 kilometer long Indore Dewas – INR 385 croreThe ministry has also decided to conduct the feasibility study for 4 such expressways between Delhi and Meerut, Chennai and Bangalore, Vadodara and Mumbai and Dhanbad and Kolkata. Source: http://steelguru.com 

NHAI goes in for a board shake-up

The ministry of shipping, road transport and highways has been under severe criticism for NHAI’s inability to meet the deadlines for developing road projects in the country.

New Delhi: Ahead of plans to give out some 10,000km in road projects over the next year, the ruling United Progressive Alliance, or UPA, is replacing at least half of the six-member board of the National Highways Authority of India, or NHAI, the country’s apex road regulator.

The radical revamp of the board, the first of its kind, comes at a time when the ministry of shipping, road transport and highways, which works closely with NHAI, has been under severe criticism for its inability to meet the deadlines for developing road projects in the country.

The revamp comes at a time when the ministry of shipping, road transport and highways has been under criticism for its inability to meet the deadlines for developing road projects in the country

NHAI oversees the National Highway Development Programme (NHDP), under which, almost 33,097km of highways were to be four-laned. Barely 50% of the projects have been awarded so far. As of February this year, work on only 7,942km of highways have been completed; of this, work on around 5,500km was completed during the tenure of the National Democratic Alliance government, which preceded UPA.

NHDP, launched in 1996, was seen as a flagship programme for successive governments, especially since an estimated 60% of freight is still transported by road in the country. There are 66,000km of national highways in India.

Neither the minister, T.R. Baalu, nor the concerned officials, NHAI chairman N. Gokulram and road transport secretary Brahm Dutt, could be immediately reached for comment on Thursday evening. As a result, it is still not clear as to why the government has sought such an overhaul in the NHAI board. The changes have been effected over the past 15 days.

Mint has independently confirmed from various government officials who do not wish to be identified that three out of the six members on NHAI’s board were asked to return to positions at the ministry in the last fortnight. According to officers at NHAI who do not wish to be identified, one of the members C. Kandasamy has already been named a chief engineer at the ministry of shipping and road transport.

A.V. Sinha and Nirmaljeet Singh, too, are being forced to “come back” to their parent ministry. “In one case, the ministry said it would promote a junior officer thereby forcing an NHAI member—on deputation with NHAI—to seek repatriation (back to the ministry),” an officer at the regulator who did not wish to be identified added.

While Sinha could not be reached for comment, Nirmaljeet Singh and Kandasamy declined comment. “I am not with NHAI any more. And for any information pertaining to board members, please contact the chairman,” Kandasamy said.

The shake-up in NHAI’s board comes at a time when the regulator has been accused of not only failing to meet deadlines, but also misgovernance.

“In fact, one of the members was threatened with suspension because some projects in Tamil Nadu got delayed,” said the officer at NHAI.

Highway builders say working with NHAI is difficult primarily because officers refuse to make decisions. “You can say one contractor is bad or may be two contractors are bad, but how can all contractors be bad at the same time? It is the authority (NHAI) that refuses to make decisions for three years sometimes. We are tired of working for them,” said an executive with a highway builder who did not wish to be named. “Why is it, that the same contractors perform on time when it comes to work by the Delhi Metro Corporation?” the executive asked.

Contractors also claim that the authority is unwilling to release money for changes in the scope of work for fear of being investigated by the vigilance department. Mint had earlier reported that almost three in ten NHAI contracts end up in some form of arbitration or the other.

None of the contractors or highway builders contacted by Mint would speak on record, saying it could affect their chances of winning contracts from NHAI in the future.

Meanwhile, the NHAI officials said the board was being revamped because it did not agree with certain proposals made by the Planning Commission on guidelines for drafting tenders for upcoming projects.

“The fact is that the minister has been unhappy with the way the NHAI has functioned in the last year and so these changes are being contemplated,” said a senior government official, who did not wish to be identified.

NHAI has also been named in a court case filed by the National Highway Builders Federation, a trade body representing highway contractors, who claimed that recent pre-qualification criteria used by NHAI favour large bidders. The case is expected to be heard by the Delhi High Court on Friday.

One analyst said it was not fair to accuse only the board, saying that other organizations, such as the Planning Commission, were equally to blame for not ironing out policy issues related to work on NHDP. “The paranoia of the government (over being blamed for non-completion of highways in an election year) could be a factor,” said this analyst who did not wish to be identified.

Source: www.livemint.com

FOUR-LANING OF PATNA-HAJIPUR-MUZAFFARPUR SECTION

4 laning of Patna-Muzaffarpur section of NH 19 & 77 has been included under NHDP Phase III in the State of Bihar on BOT (Toll) mode. Bids for 4 laning of Patna-Muzaffarpur Section of NH 19 & 77 were invited in June 2005 under old Model Concession Agreement (MCA) for which no response was received. Bids were again invited for the second time in June 2007 on the basis of new MCA with the last date of submission of bid as 20.08.2007. But, no response was received this time also. As there is no response of bidders on toll based BOT bid for the project stretch, Government has accorded approval for changing the mode of upgradation of Patna-Muzaffarpur Section of NH 19 & 77 from BOT (Toll ) to BOT ( Annuity). This information was given by the Minister of State for Shipping, Road Transport and Highways, Shri K.H. Muniyappa in a written reply in the Rajya Sabha today.  Source: http://pib.nic.in

Annuity model for Bihar, Jharkhand BOT projects

NHAI has not been able to award any project on build-operate-transfer basis via tolling in the states in last two years

New Delhi: Desperate to get the roads programme off the ground in Bihar and Jharkhand, where the private sector is declining all offers—including on lucrative stretches—in view of the challenge from Leftist extremist groups, the Centre is offering investors guaranteed payments instead of recovering their investment by collecting toll revenues.

A senior official of the National Highways Authority of India (NHAI), the regulator for highways, who did not wish to be identified, said, “The reason for this (investor disinterest) is partly law and order situation in these states, and Naxalism.”

As a result, NHAI has not been able to award a single build-operate-transfer (BOT) highway project through tolling in these states in the last two years. In such highway projects, the company awarded the contract for constructing a stretch of highway collects toll from those using the highway.

 

Law and order, and Naxalism scare away bidders, who recover their investment from highway tolls

 

Prime Minister Manmohan Singh recently said that Naxalites, Leftist extremists, posed the single biggest internal security challenge to the country. As many as 13 out of 28 states in the country are classified as Naxalite-affected.

To woo investors towards these highway stretches, NHAI is now planning to recast these BOT projects on an annuity basis, wherein contractors who are awarded projects would be paid a guaranteed amount in instalments.

The authority had carved out around 11 highway sections in Bihar for awarding under the BOT mode in 2006 under phase III of the National Highway Development Programme.

NHAI first put up its most lucrative stretch, Patna–Muzaffarpur, for bidding in early 2006, but it received no response. “We then tried putting up another stretch for bidding as well, but even then the companies did not show any interest,” said the NHAI official.

The authority has faced a similar problem in Jharkhand, where it did not receive any bids for a couple of tolled road projects.

The lack of interest in tolling projects in Bihar and Jharkhand is happening at a time when NHAI has made it a policy to gravitate towards BOT projects in order to reduce the government’s investment in the highway sector.

Another official in NHAI, who also did not wish to be identified, confirmed that the highways regulator now planned to redraft the proposal for these projects under annuity terms.

Members of Parliament from the two states said concerns over viability of the projects apart, private players were hesitant to take up contracts in these areas because they feared for the security of their staff.

Bhubaneswar Prasad Mehta, a Lok Sabha member of the Communist Party of India from Hazaribagh in Jharkhand, said even as some tenders were floated last year, there was little response from the private agencies. “Infrastructure development cannot happen in a vacuum,” he said. “Why should anyone risk his life in an area where there is no rule of law and little security? We are planning to raise this issue yet again in our party’s three-day state conference in Ranchi, which begins on 15 March.”

However, Nikhil Kumar, a former special secretary for internal security in the Union ministry of home affairs, and a Lok Sabha member of the Congress party from Aurangabad in Bihar, said the situation was somewhat better in his constituency.

“I can say for my constituency that though the quality of work remains a matter of concern, wherever we have managed to provide sufficient security to the contractors, with the help of the state government, there has been some progress,” said Kumar. “If the political representatives from these two states, and other areas affected by Naxalism keep pursuing the matter with the state governments and the private executing agencies, we can get the work done. In my constituency alone, about 25 link roads will be constructed under the Pradhan Mantri Gram Sadak Yojana (Prime Minister’s Village Road Programme) and work is set to begin. Earlier, between 2004 and 2007, seven other roads were completed in my constituency,” he added.

Ram Deo Bhandary, a Rajya Sabha member of the Rashtriya Janata Dal from Bihar, said it was quite clear that even a few high-profile incidents of violent crime could deter developmental activities.

“There haven’t been too many incidents of late, but, of course, law and order remains an area of concern. If contractors are not coming forward to take up work, it is quite clear that the state has not been able to instil confidence in them,” Bhandary said. Source: http://www.livemint.com

Mega six-lane projects in offing

With access-controlled expressways attracting massive investments, the Ministry of Road Transport and Highways has decided to conduct the feasibility study for more such expressways.

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  Construction companies eyeing the access controlled, six-lane expressway projects of National Highways Authority of India (NHAI) are likely to get investment opportunities for at least four such projects spread over 495 km over the next few months.They are Chandikhol-Jagatpur-Bhubaneswar (70 kilometre length, estimated cost Rs 761 crore), Delhi-Hapur (47 km, Rs 474 crore), the 198-km stretch of Vijayawada-Elluru-Rajamundri (Rs 1,602 crore) and the 180-km stretch on Delhi-Agra highway (Rs 1,918 crore). The feasibility reports for these projects are already completed and the work is likely to be awarded in about six months, said NHAI officials.Toll collection  These projects are for widening the current four-lane highways into six lanes and operating them for certain durations.Companies would have to bid competitively for these projects on a revenue-sharing basis. Thus companies would have to bid on the extent of toll revenue that they are ready to share with the Government if they are allowed to operate the roads.Since these highways are already four-lane stretches, the road operators can start toll collection even during the project construction phase from an ‘appointed date’ (within six months of winning the project), mutually decided by NHAI and the road operator. The toll revenues will be routed to an escrow account.Recently, the NHAI awarded four such mega projects of 882 km length, which are likely to cost an estimated Rs 10,912 crore.From the NHAI perspective, these projects have emerged as money-spinners, with companies willing to foot the entire construction cost and part with two per cent to 48.06 per cent of their revenues in the initial leg of the project.At the end of the concession period, which is about 12 to 15 years duration, the winning firms have agreed to part with 12 per cent to 59 per cent share of toll revenues.More studies  The feasibility reports for another ten projects of similar nature are under preparation. They are: Kishangarh-Udaipur stretch (315 km, Rs 2,205 crore), Udaipur-Ahmedabad (235 km, Rs 1,645 crore), Varanasi-Aurangabad (190 km, Rs 1,330 crore), Nellore-Chilkaluripet (184 km, Rs 1,288 crore), Krishnagiri-Walajapet (148 km, Rs 1,036 crore), Pune-Satara (145 km, Rs 1,015 crore), Ludhiana-Chandigarh (85 km, Rs 595 crore), Belgaum-Dharwad (80 km, Rs 560 crore), Samakhiali-Gandhidham (56 km, Rs 392 crore), Indore-Dewas (55 km, Rs 385 crore).With access controlled expressways attracting massive investments, the Ministry of Road Transport and Highways has decided to conduct the feasibility study for four such expressways between Delhi-Meerut, Chennai-Bangalore, Vadodara-Mumbai and Dhanbad-Kolkata. This was decided by the Road Ministry officials at a meeting with State Government authorities recently.Source: http://www.thehindubusinessline.com

DF govt to spend Rs 3000 cr on road to power

Though its four-year rule in Maharashtra is yet to bring a visible change in the state, the Democratic Front (DF) government now wishes to make amends during its final year in office.

For the 2008-09 fiscal, the state will witness large-scale road construction works, senior officials of the Maharashtra State Road Development Corporation (MSRDC) and Public Works Department (PWD) told ET. The two agencies, which have been keeping a low-profile during the DF rule, compared to the 1995-1999 Shiv Sena-BJP government’s period, want to make up for the lost time. “We will have many more projects to showcase before the people,” Maharashtra chief minister Vilasrao Deshmukh had said earlier.

Road works amounting to more than Rs 3,000 crore have been initiated by these two agencies across the state. All projects are being undertaken on build, operate and transfer (BOT) basis and the state agencies are collaborating with the National Highway Authority of India (NHAI). Such is the project’s volume that the PWD, MSRDC and NHAI would upgrade around 900 km of roads across Maharashtra.

“Most of the roads under construction would be completed in a year or so. We are following a strategy of aggressive development in the road sector, which is one of the main drivers of socio-economic growth. Roads not only connect but also bring investment,” PWD secretary DB Deshpande told ET.

The state is using the Rs 2,000-crore grant sanctioned by the Union government to upgrade the corridors of national highways, which pass through Maharashtra. This allocation has to be used in the 2008-2009 fiscal. The work includes six-laning of the 90-km corridor between Dahisar-Talasari on Mumbai-Ahmedabad National Highway, the 275-km corridor between Satara-Karad-Kagal, which leads to Bangalore, the 86-km stretch between Igatpuri and Pimpalgaon and construction of an elevated 5.5 km long corridor bypassing the Nashik city.

“Maharashtra has always been regarded as the leading state as far as quality of road is concerned. But good roads have utility beyond the obvious connectivity point of view. The World Bank has estimated that an investment of Rs 20 lakh in road works creates one perpetual job.

We are looking at employment generation and economic potential of roads, which would be give an edge to Maharashtra in these industrially competitive times,” an MSRDC official said. Lot of action is also visible on the state highways. The PWD has got Cabinet approval for the Rs 800-crore four-laning of Shirur-Nagar-Pune-Aurangabad state highway, which is 300-km long. “Work has started on this project and should be completed by May 2009,” Mr Deshpande added.

Source: economictimes.indiatimes.com

Nine infrastructure firms in customs net

Gammon India, Punj Lloyd, Era among those being investigated for diverting tax-exempt equipment for pvt work

The central intelligence unit of Indian customs here has launched a series of cases alleging import duty evasion by nine infrastructure firms, including well-known names in the field such as Punj Lloyd Ltd, Era Constructions (India) Ltd and Gammon India Ltd.

The companies are alleged to have diverted construction machinery, imported without customs duty specifically for projects financed by the United Nations, other international aid organizations and approved by the government, to private projects, thus evading customs duty.

The money involved in the case is not large in itself, but the development is significant since these firms are involved in construction of roads for projects approved by the National Highways Authority of India (NHAI) and aided by the World Bank, Asian Development Bank and the UN.

Under the Customs Act 1962, equipment imported into India for completion of infrastructure projects financed by the UN or an international organization and approved by the government is exempt from customs duty. The firms had imported machinery, such as piling rigs for construction of roads, and had availed the exemption.

Core of the problem

“We have already booked cases against nine firms and have recovered over Rs12 crore against such illegal import of piling rigs,” said R.K. Mahajan, commissioner (general) of customs, Mumbai.

Apart from Punj Lloyd, Era Constructions and Gammon India, the list of companies provided by the customs includes Afcon Infrastructure Ltd, Ircon International Ltd, Meher Foundation and Civil Engineers Pvt. Ltd, Villayati Ram Mittal Pvt. Ltd (New Delhi), Vijay M Mistry Construction Pvt. Ltd and Maytas Infra Pvt. Ltd.

Each piling rig costs around Rs4 crore and attracts close to Rs1 crore import duty.

“We have also seized piling rigs worth Rs8.25 crore,” Mahajan said. According to him, these companies have evaded customs duty of at least Rs20 crore and the amount could be even more as the investigation is not yet complete.

The infrastructure projects are spread across India. For instance, Punj Lloyd, one of the largest engineering and construction firms engaged in infrastructure projects, had imported piling rigs for its two NHAI-approved projects in Assam, but, according to the customs intelligence unit, these rigs were diverted to New Delhi.

“The company had rented out one of the machines to Delhi Metro Rail Corp. Ltd,” claimed a senior officer of customs who did not wish to be named.

However, the firm admitted it has been “summoned by the central intelligence unit, Mumbai customs, seeking certain clarifications/information pertaining to import of hydraulic operated self-propelled piling rig along with accessories,” imported by it under customs duty exemption scheme.

“Unfortunately, by the time such rig, along with its accessories, touched the boundaries of India it was realized that the said rig etc. could not be optimally utilized at the Guwahati to Nalbari Section of NH31 in Assam project due to non- availability of work… Since the machinery so imported was worth crores of rupees and keeping it idle would not only result in decaying and deterioration but also have an adverse financial impact…the company deemed it prudent to deploy the same to some other appropriate site,” the company wrote in its email.

It admitted that the rig was deployed at the DMRC project “which included construction of roads.” Stating that “by utilizing the…rig at the DMRC project we were in a position to keep the same in running condition,” the company said in its email that the rigs would be used at the Assam project “the moment we receive a green signal…from NHAI.”

“We believe we have acted within the intent and framework of the customs notification and the undertaking and there is no violation of any nature whatsoever and your source on information about the tax evasion on our part is unfounded and baseless,” the email went on to say.

The New Delhi-based Era Constructions, now known as Era Infra Engineering Ltd, was awarded two contracts for construction of roads in Chhattisgarh. However, according to the customs, the machinery was allegedly rerouted to other parts of India. “During the investigation, one of the machines was found at the NTPC Ltd’s site in Dadri in Uttar Pradesh. The other was found in Haryana,” Mahajan said.

Era Infra’s vice-president (commercial) Anil Bhasin said the firm had paid customs duty and interest for the equipment, which was shifted to other nationally important projects of government and public sector undertakings. According to him, the company diverted a few equipment that were not required at the assigned projects to other sites. It actually wanted to return these equipment, but could not do so as there was no provision to return such equipment. “The customs duty for such equipment was paid,” insisted Bhasin.

Gammon India, a Mumbai-based construction firm, according to Mahajan, has violated the rules by diverting machinery to another location for private use. However, he declined to disclose the location where the equipment was transferred and said the case was under investigation.

Gammon India, too, denied being involved in customs duty evasion. “There may be a possibility that some construction companies who have imported equipment under such exemptions could have utilized the same for projects other than for which such exemptions are applicable like, real estate, housing projects, shopping malls, etc. To clarify your doubts, Gammon does not undertake real estate/housing projects which could have been a potential misuse as per your concern. In fact, central intelligence unit had enquired about the utilization from all the importers who had imported equipment under the above exemptions,” said Umakant Tiwari, assistant general manager (procurement), Gammon India, in an email response.

Source: livemint.com

Impact of Budget 2008 on infrastructure

Chennai: The biggest benefit that the latest Budget has conferred on the entire infrastructure sector is the removal of double tax on dividends, says Kuljit Singh, Partner, Ernst & Young.“As infrastructure projects are typically developed through SPVs (special purpose vehicles), removal of double taxation can lead to a saving of at least one level of dividend taxation (in the existing level of 16.995 per cent including surcharge),” he explains in an e-mail interaction with Business Line.“Additionally, at present a large number of developers are looking to set up holding companies for power, highways, ports and so on. The valuation of all of these holding companies would be positively impacted due to this measure,” foresees Kuljit.Another positive from the Budget for infrastructure projects that he mentions is the reduction of duty on project imports from 7.5 per cent to 5.0 per cent. A key negative, however, is the duty structure on cement, which is expected to push up costs, rues Kuljit.While the Union Budget for 2008-09 addressed the needs of various infrastructure requirements including that of social and rural infrastructure, there was not much to offer as tax sops, or for promoting private sector investments, bemoans Vishwas Udgirkar, Executive Director – Government Regulation and Infrastructure Development Practice, PricewaterhouseCoopers.“As evident from various reports and documents, the Government is relying on huge investments from the private sector to create infrastructure that can support the overall economic growth,” he reasons. It was expected, therefore, that the Budget would address various issues relating to financing of infrastructure.“On that ground, the Budget has little to offer except the proposed change in the treatment of dividend distribution tax (DDT).” Vishwas concedes, though, that this could be a significant measure to encourage infrastructure financing, welcome by the industry.Another financial measure that he highlights is the exemption of TDS (tax deduction at source) on listed corporate debt instrument, which is expected to help, over the long term, in the development of the debt market.The Budget, however, has not addressed a number of issues like exempting foreign borrowings by infrastructure companies from withholding tax requirements, providing similar capital gain tax treatments for listed and unlisted equity, treating infrastructure holding companies as a separate class of NBFCs (non-banking financial companies), exempting Section 80IA companies from minimum alternative tax (MAT) and re-introducing Section 10(23G), lists Vishwas.Talking of the power sector, among the infrastructure components, Kuljit also finds it upsetting that the Budget has not mentioned the extension of section 80IA tax benefit for power projects.“Non-extension of this tax benefit will have a negative impact on power projects which are being proposed today, as most of these may not be completed before March 31, 2010, which is the last required date for commissioning under the existing 80IA tax provision of the Income Tax Act, 1961.”The national fund proposed for power transmission and distribution (T&D), if properly structured, can be used to strengthen the T&D network at the state level, suggests Kuljit. “Also, the allocation of Rs 5,500 crores for Rajiv Gandhi Grameen Vidyut Yojana will positively impact the state-level networks.”As regards roads and highways, he sees nothing significant in the current Budget, but for an increase of around Rs 2,000 crore being proposed in the NHDP (National Highways Development Project), and an allocation of additional Rs 4,000 crore for rural roads.In the medium to long term, the cut in excise duty from 16 per cent to 12 per cent for small cars may lead to increase in traffic on roads, thus positively impacting toll roads, he anticipates.Vishwas is of the view that the focus on nationwide monitoring of all important programmes is a welcome step, but cautions that such monitoring systems have to be put in place quickly.What about aviation? Despite the fact that airlines (in particular, low-cost airlines) are now increasingly serving the masses, aviation is still perceived as the preserve of the rich and hence the tax policies are structured accordingly, laments Kuljit.“The industry was keenly expecting reduction in sales tax (from the 20 to 30 per cent levels to around 4 per cent) on ATF (aviation turbine fuel) and changes in tax on lease rentals,” he reminds. “However, none of these expectations has been accepted in the Budget, which means that the airline industry’s rough patch may continue.”**Source: http://InterviewsInsights.blogspot.com

Government falls short on its promise to build roads

 The government has fallen short on its promise to build roads in 2007-08. The Economic Survey revealed that while the flagship Golden Quadrilateral connecting the four metros was 96% complete at this time, only 21% of the north-east and south-west corridors were finished till November 2007. This means the end-2009 completion target for the project is unlikely to be met. The port-connectivity projects, which envisage linking major ports with national highways, are also way behind schedule.

Work under the National Highways Development Project (NHDP)-III has also fared terribly with only 274 km completed by November 2007. The project envisages four and six-laning of 12,109 km of highways on the build, operate and transfer (BOT) basis. While the first phase covering 4,815 km was expected to be completed by end-2009, the National Highways Authority of India (NHAI), which spearheads the construction and upgradation, finished only 5.69% of the target.

The NHDP-III is estimated to cost Rs 80,626 crore and 30 contracts covering more than 1,900 km have been given out so far with another 3,000 km to be awarded during the current financial year.

Lackadaisical implementation notwithstanding, highway connectivity among Indian cities, however, remains a priority. The Survey has stressed the need to connect all cities by national highways in the medium term.

Source: economictimes.indiatimes.com

Hit the road: Infrastructure growth is revving up

The indian infrastructure story is just waiting to unfold. It is a foregone conclusion that the need for infrastructure to facilitate economic growth in India, both immediate and long-term , is ever more pressing. The growth rates witnessed in the Indian economy today are indicative of the change to follow —infrastructure has been expanding at an accelerated pace to support the economic growth rate of 9%. India’s infrastructure development has so far been predominantly financed publicly. The urgent need of the hour is an enhanced approach that would create a balance between public and private sector roles, complemented by transparent public policies. The Government has already taken many proactive measures such as opening up a number of infrastructure sectors to private players , permitting foreign direct investment (FDI) into various sectors, introducing model concession agreements and taking up projects such as the National Maritime Development Programme and National Highway Development Project, among others. The next four to five years will witness implementation of some key infrastructure projects such as additional power generation capacity of 70,000 MW; development of 16 million hectares through irrigation works; modernisation and redevelopment of four metro and 35 non-metro airports; six-laning 6,500 km of Golden Quadrilateral and selected National Highways. Focus will be on key infrastructure sectors of highways, ports, airports, railways and power. Having been part of the Indian infrastructure history, we at GVK have always believed that the key to developing a sustainable infrastructure in India is to build for the future. India will see an investment to the tune of $500 billion in infrastructure in the next five years. Coupled with government support, this investment will fructify in the form of key infrastructure projects to strengthen India’s cities. The next four years will bring a sea change in infrastructure and as a result, in another ten years, we will see the emergence of a new India. Source: http://economictimes.indiatimes.com

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