MUMBAI: State Bank of India has stopped lending to road projects that have not completed land acquisition for any part of a proposed stretch, a move aimed at stemming the spike in bad loans that has led the Chief Vigilance Commission andCentral Bureau of Investigation to urge banks to tighten their norms.”Unless you have 100% land acquired and in your possession, we will not finance the project. Earlier, we would do so with 95%,” SBIBSE 0.45 % chairmanPratip Chaudhuri told ET.

Govt officials cannot deal with such projects: Mayaram

Arvind Mayaram, Secretary, Department of Economic Affairs, stressed the need to have a regulator for the road sector to handle disputes in public-private-partnership (PPP) projects.

He said Government officials do not have the capacity to deal with PPP projects where contracts between the Government and private sector span 20-30 years, thus requiring constant interaction and adjustment between the two parties based on the changing circumstances.

“Traditionally, we were used to paying the private sector to do a job in two-three years, after which the relationship ended. How to manage relationships in post award framework is an area where there is scope for improvement,” Mayaram said speaking at a FICCI conference here on Monday.

The regulator can help manage when the Government’s relationship with the private sector gets rocky, said Mayaram.

Omnibus Bill

Incidentally, the Planning Commission has taken a stance against the idea of having a road sector regulator to deal with such issues. It has rather supported the idea of an omnibus Bill, which will spell out ways for dealing with disputes in PPP projects.

Infrastructure

The Government has been increasingly wooing the private sector to build infrastructure through public private partnership basis.

In 2005, it decided to bid out all road projects on BOT-toll mode first, where the private developer designs, finances and builds a road, maintains it, collects toll from users for a long-term period. Vijay Chhibber, Secretary, Road Transport and Highways, said the Ministry is working on a proposal to have a regulator, as was announced in the Finance Minister P. Chidambaram’s Budget speech this year.

Advisory role

The regulator would have an advisory role on renegotiation of existing contracts, setting of service standards, project entry and exit options, tariff structuring and toll mechanism and knowledge management, according to the proposal under the consideration of the Road Ministry.

It would also have an adjudicatory role on contract dispute resolution, renegotiation of future contracts and enforcement of contractual provisions.

This is for the first time that the Highways Ministry has officially spelled out its detailed proposal for the regulator.

Source- http://www.thehindubusinessline.com

 The allocation had been enhanced for the maintenance and upkeep of the national highways in the state, the chief minister said, adding that Fernandes approved a proposal to construct a highway from Jhajjar to Dwarka in Delhi via Dhansa border on Najafgarh drain for about `100 crore, under the central road fund (inter-state connectivity).

Source-http://www.hindustantimes.com

Delhi government envisages making Delhi a hub of clean, high technology and skilled economic activities, he added.

He said the services of Wazirpur Industrial Area, spread over 210 acres, were taken over from North Delhi Municipal Corporation (NDMC) in December last year.

“Total length of all roads of Wazirpur Industrial Area, with road width varying from six to 25 metres, is 18.6 kilometres.

Almost all the roads of the industrial area were in a dilapidated condition. The work of improvement of major approach roads would be completed within six months at a cost of Rs 13 crore,” Yusuf said.

The industrial area is on the top of production of stainless steel products and exported goods worth Rs 1,000 crore per annum.

The scope of work includes redevelopment and up-gradation of 2,829 metre length with cement concrete roads, he said, adding DSIIDC intends to upgrade the infrastructure of the industrial areas by improving roads and drains as well as footpaths.

Source-http://www.indiatvnews.com

There is good news for the commuters travelling between Sarita Vihar, Kalindi Kunj and Okhla. The much awaited and one of the longest underpasses will soon be made operational here. It will reduce the distance between Sarita Vihar and Okhla. From nine km it will be reduced to one km. The construction of the underpass at Sarita Vihar within the railway boundary is being executed by the Northern Railway on behalf of the Delhi Development Authority. This underpass will connect Okhla Industrial Area with Kalindi Kunj on the Noida side.

“I will benefit a lot as I live in Block J, Sarita Vihar, and my office is in Okhla Industrial Area Phase-4,” says Paramjeet Kaur Juneja, a resident of Sarita Vihar. This is probably the largest underpass being constructed by the advance technique of box pushing. The segments are precast over a horizontal RCC thrust bed, adjacent to the railway embankment. The boxes are then pushed into the embankment one after another with the help of hydraulic force created by jacks. The force of the jacks is transmitted to precast segment and thus it moves forward. There is uninterrupted train movement during the construction. The underpass is being made under the Delhi-Mumbai rail route, one of the busiest in India. About 300 trains pass on this rail section every day.

The underpass is being built on the two-four box pattern. It will have eight lanes for vehicular movement and one lane for the pedestrians and cyclists. Adds Bimal Jairaj, another resident of Block H, Sarita Vihar, “There is a designated space for pedestrians and cyclists on this underpass. Usually, these two categories are left to fend for themselves since there is no provision for them in the design plan.” “Once the underpass is functional, it will reduce the travelling time. The railway track has been continuously monitored and uninterrupted train movement at controlled speed was ensured during the construction phase. The underpass is likely to be functional in the next six months,” says Neeraj Sharma, chief public relations officer, Northern Railway.

Source-http://paper.hindustantimes.com

By YASHODHARA DASGUPTA, ET Bureau

  

NEW DELHI: To revive India’s stuttering highway building efforts, the government may scrap several existing contracts that are making little progress on the ground. The road transport and highway ministry has asked the National Highways Authority of India to review all languishing projects and identify those that can be terminated on contractual grounds, so that they can be bid for all over again.The move comes in light of the fact that several projects awarded in recent years are either stranded midway or have been complete non-starters. The road ministry also wants the same clarity for those stalled projects that could benefit from deferral of premium payments.

It will re-circulate a Cabinet note on its proposal to allow financially stressed developers to defer payments of premia that they had committed to pay to win the highway projects. An additional option of cancelling the projects and re-bidding them would now be included in the note.

Road ministry officials said this note, which has been modified based on the finance minister P Chidambaram’s advice on the matter, will be sent to the Cabinet so that a final call can be taken at the highest level and the projects can finally start moving again.

“A clear decision needs to taken. We have asked NHAI to find out how many projects can be terminated. The decision on what to do for projects that fall under the premium restructuring case will be taken at the Cabinet level. But for the rest, we can decide on a course of action now,” said a senior road ministry official familiar with the issue, adding that NHAI has also been asked to determine which of the premium-based highway development project are indeed stressed and thus, deserve a bailout.

“We are studying around 35 highway projects of which 23 are premium-based (with premium of close to 1 lakh crore) and the rest are based on viability grant funding. We will basically divide the projects into four categories – projects where developers are ready to operate under the original parameters as long as we fulfill all our obligations, projects that should be terminated with penalty where the concessionaire has defaulted, projects which should be terminated without penalty where both the concessionaire and NHAI have failed to meet obligations, and those where developers are sitting on the fence and awaiting more clarity from the policy end,” said an NHAI official adding that the NHAI board will deliberate on this list in this in their upcoming board meeting on August 22.

The highway authority is reviewing whether these 35 contracts can be terminated either for developer default, NHAI default or both and the NHAI board will deliberate on this in their meeting later this week, the official said.

NHAI has been batting for the premium restructuring proposal that would allow developers in stalled projects to restructure their premium payment so that the financial stress is relieved. However, in May, the law ministry rejected it on grounds of legal and constitutional feasibility following which the road ministry referred the matter to the Committee of Secretaries (CoS) who did not support the proposal citing the law ministry’s objection. In July, after a fresh request from the road ministry, the law ministry backtracked on their previous advice and instead said the matter should be resolved between the finance and road ministries.

Earlier this month, the FM wrote to road minister Oscar Fernandes cautioning him of the ‘moral hazard’ in renegotiating contracts post-award and that the law ministry’s permission must be taken.

 

Source-http://economictimes.indiatimes.com