The Empowered Committee of the Ministry of Rural Development has sanctioned proposals worth Rs 1,068 crore under the Pradhan Mantri Gram Sadak Yojana. While intimating the approval of the  committee to Chief Minister Naveen Patnaik, Union Rural Development Minister Jairam Ramesh expressed his displeasure over the slow pace of completion of the infrastructure projects.

“The State is required to enhance its capacity to deliver the desired quality of roads,” the empowered committee remarked.

Advising the State Government to increase the strength of the project implementation units (PIUs), Ramesh said 2,048 road works out of the project sanctioned till March, 2011, have  remained incomplete. “Unless the State enhances its execution capacity, the desired progress with respect to speed and quality cannot be achieved.

Hence, the Ministry has decided to sent the Joint Secretary along with his team to the State to have a meeting with the State officials and the contractors to resolve various issues faced by the State before August end,” Ramesh said.

The MoRD has sanctioned 343 road projects covering 1,184 km at a cost of Rs 584 crore and 140 long span bridges at an estimated cost of Rs 483 crore.

As the quality of roads constructed under the flagship programme is not satisfactory, the Union Minister has suggested that the Chief Minister should institutionalize quality monitoring system in a few selected districts and send the plan to the Ministry by the end of this month.

http://newindianexpress.com

 

GUWAHATI: The implementation of road and infrastructure projects in North-East has been slow and the speed of completion has been almost half than the national average, the Union transport secretary said today.”North East takes twice the time to complete a project than the national average,” Road, Transport and Highways Secretary ,Vijay Chhibber told reporters here.

Road, Transport and Highways Minister Oscar Fernandes and senior officials from the ministry today held a review meeting of the road projects in North East with chief ministers and representatives of the states from the region.

“Land acquisition and forest clearance are the main issues in implementing the projects. We have the money, but we are getting stuck at implementation,” Chhibber said.

“Many state PWDs are not up to the mark in implementing the projects. Pre-construction activities are taking too much time in this region,” he added.

The Ministry is implementing an ambitious Special Accelerated Road Development Programme (SARDP-NE) to develop road network in this region, aiming to provide connectivity to all the district headquarters.

The two-phased programme, including Arunachal Package, covers about 10,141 km.

The phase A of SARDP-NE, including Arunachal Package, covers 6,418 km and is estimated to incur an investment of Rs 33,688 crore during the 12th Five-Year Plan. The phase B is in conceptual stage.

Out of that, 2,000 km is planned for the current fiscal at an investment of Rs 3,100 crore, Chhibber said.

So far, about 1,000 km have been completed and the entire project is targeted for completion by June, 2016.

The project is being executed by the state PWDs, Border Roads Organisation, National Highways Authority of India and the Ministry of Road Transport and Highways.

By Arijit Barman & Rachita Prasad , ET Bureau |

MUMBAI: Engineering major Larsen & Toubro is exploring an option to raise between Rs 2000 crore – Rs 2500 crore by clubbing operational road projects of its infrastructure development arm L&T IDPLinto a separate entity which could be listed overseas through a business trust model.This proposal was separately mooted by a European as well as a Japanese bank to the company, said multiple sources briefed on the matter. This new idea is based on the increasing popularity of the model amongst global financial investors who are scouting for high quality operating yield assets in infrastructure,real estate and renewable energy.

Currently L&T IDPL has a portfolio of 18 roads, 10 of which are operational. All the projects are housed under individual special purpose vehicles (SPVs). The total project outlay for the road projects is Rs 21,600 crore. L&T is among the top two road developers in the country.

Interestingly, the trust proposal has come at a time when L&T IDPL is already in advanced negotiations with a clutch of sovereign wealth funds, pension funds and long only investors to raise up to $500 million by diluting 15-20% at an initial equity valuation in excess of $2 billion. Abu Dhabi-headquartered Mubadala Development Corporation and Khazannah, the investment vehicle of the government of Malaysia and a global pension fund are among the potential suitors. Morgan Stanley has already been advising L&T IDPL in those live negotiations.

The sources quoted earlier added that the entire matter is still at a preliminary stage and may or may not translate into a dea. “The proposals are still being evaluated and no final decision has been made as yet. It is still preliminary brain storming,” said a senior official involved directly in ongoing discussions.

Sources add that L&T’s management would not want to upset the ongoing discussions and are evaluating if an equity investment in the parent platform (L&T IDPL) can co-exist with the listing of the operational road asset at level below via the trust model.

“Tapping alternate markets have always been part and parcel of the ideas pool for IDPL. It’s not a new or novel idea. Even some Indian companies have tried it in the past. The company’s operating team will take a final call on its strategy to find growth capital. We haven’t constrained them. Based on their decision, they will come to the board and also to L&T with a concrete proposal…They haven’t so far,” said R Shankar Raman, CFO, L&T and a director of L&T IDPL.

Raman felt that both transactions could potentially co-exist. “Infrastructure is a nascent sector, so are the different investment routes. This structure will evolve over time. If the parent’s mandate is to identify, develop and commission good projects, then post commissioning you don’t have to run them yourself for the next 35 years,” he added.

“Despite the overall slump in infrastructure and considerable macro economic headwinds, the PE transaction at L&T IDPL has progressed considerably even though it’s been slow and challenging. Serious negotiations are on with an interested party and a deal should close in the next few months. So this new development has been a surprise to us but will not be at the cost of the other. The management will only proceed if the potential financial investor does not have an objection,” said one of the sources mentioned above.

However when contacted L&T IDPL CEO K Venkatesh said he had no such plans to list the road portfolio separately or create an investment trust. “Bankers keep suggesting ideas. But we are not looking at that option. Our plan is to get private equity and we have reached a stage where some firms have shown a lot of interest and we are going ahead with due diligence.”

As per new plan, a separate trust will be created where all or most of the operational roads will get transferred. This trust then listed overseas and will be traded amongst investors who look for annualised cash flows or yields. The advisors have suggested three markets — Singapore, Hong Kong and London — for a potential listing where there is still traction for Indian paper.

The move is aimed at raising funds for the roads to meet ongoing and future capital requirements and also to trim the existing debt of parent L&T. If the debt from the operating road projects were to be transferred into a separate trust, the strain on L&T’s consolidated books will reduce significantly. Being an infrastructure developer, L&T IDPL is a cash guzzler but its debt gets reflected in the parent’s books impacting its credit ratings adversely.

Till 31st March 2013, excluding L&T standalone and L&T Financials, the group had Rs 29,000 crore of debt – a lion’s share was on account of L&T IDPL.

Unlike companies, business trusts aren’t required to show profits before distributing available cash funds. As a result, investors can get returns even before profits are generated. This is useful for businesses that generate high cash flows, but see a substantial depreciation of their assets — in this case, capital-intensive highway projects.

“Forming an investment trust looks like a viable option on paper. But in reality, a company like L&T would require to have ample number of operational projects with toll collection data history to make a move like this. Listing an investment trust overseas entails some degree of forex risk too. Also, in with domestic interest rates being high and uncertainty over GDP growth, it may be challenging to get very good valuations,” warned Nitin Bhasin, analyst, Ambit Capital.

Beyond roads, L&T IDPL’s portfolio of 27 infrastructure assets includes three ports and a metro rail project. Out of that, Rs 16,400-crore Hyderabad Metro project is one of the most ambitious BOT (build operate and transfer) asset.

The company has also partnered with Tata Steel for an equal venture for the Rs 3,000-crore Dhamra Port, with a debt equity of 2:1. As on March 2013, the total project cost of all the SPVs put together is a whopping Rs 65,600 crore. While the equity is Rs 5500 crore, the residual equity commitment of Rs 8700 crore is yet to flow in. The debt in the projects stood at Rs 51,400 crore.

Source-http://economictimes.indiatimes.com

NEW DELHI: The National Green Tribunal on Tuesday ordered an interim stay on a road widening project in South Delhi’s Vasant Kunj till the next hearing on May 29. The tribunal also warned the Delhi government of strong action if further felling of trees took place.

The government admitted that the Public Works Department had started felling trees without mandatory permission from the forest department.

The tribunal also issued a bailable warrant against the chief executive engineer of the PWD because he was not present at the hearing.

The tribunal was hearing a petition against the widening project filed by Sonya Ghosh, a resident of sector D3 of Vasant Kunj. The tribunal has asked the government to file a reply in two weeks. In a three-part series on March 5, 6 and 7, Hindustan Times had highlighted how the PWD widening a 3.5-km stretch from Andheria Mod towards Mahipalpur by demolishing boundaries and felling trees illegally.

A group of residents had said that a 75-metre-wide road (current width is 17.2 metres) for high-speed traffic through a densely-populated colony would disturb normal life. On completion, this would be the Capital’s widest road.

A local court on February 26 has already stayed work on the road-widening project in front of Sector D2 on a plea by the residents.

They claimed that the project was being executed in the most brazen manner and in complete disregard of the civic and environmental norms.

The representation of PWD in the tribunal is necessary to adjudicate the dispute and, in fact, PWD is responsible for carrying out the widening work, said the tribunal.

The 3.5-km stretch where it is being widened from four lanes to eight lanes has on its both flanks hundreds of flats in several pockets of sectors such as A and D. Sector A has pockets named A, B and C. Rest of the sectors in Vasant Kunj have pockets named in numeric value.

The brazen felling of trees without permission has exposed the lack of seriousness on part of the authorities in protecting Delhi’s green cover.

When the felling started residents and activists went up in arms. As the chorus grew, felling was stopped but the digging of soil continued, leaving a number of trees with exposed roots and without any soil support.

Source- http//www.hindustantimes.com

 

 

 

Shares of IRB Infrastructure Developers  gained more than 2 percent on Tuesday after the company’s subsidiary IRB Westcoast Tollway (special purpose vehicle) has executed concession agreement with NHAI for the road project. 
The project includes construction of four laning of Goa/Karnataka border to Kundapur section of NH-17 in the State of Karnataka on design, build, finance, operate and transfer (toll) basis.
“Estimated cost of the project is approximately Rs 2,600 crore and the construction is to be completed within 910 days from the appointed date,” the company said in a release sent to exchanges.
The SPV will get tolling rights on NH-17 upon completion of construction. The grant sought by the SPV from NHAI is Rs 536.22 crore.
At 14:09 hours IST, shares went up 0.72 percent to Rs 112.30 on Bombay Stock Exchange.

Market capitalisation of the company currently stands at Rs 3,732.45 crore.

 

Source- http://www.moneycontrol.com