The UPA government has announced a slew of measures to fund infrastructure projects, at a time when long-term credit and international suppliers? credit lines have dried up. The short-staffed India Infrastructure Finance Corporation Ltd has been authorised to raise Rs 10,000 crore in this fiscal (plus Rs 30,000 crore in the next!) to refinance bank lending for infrastructure projects.
But even as the Centre is busy arranging funds, it seems to have overlooked the fundamental problem?there are just not enough viable projects ready to be bid out through the public-private partnership route.
A case in point is the highway sector, most importantly, the National Highway Development Programme. It?s one of Prime Minister Manmohan Singh?s pet projects, but this financial year has seen only three of the targeted 61 national highway projects being awarded.
In recent months, this lethargic performance can be rationalised by the lack of funds, but this wasn?t always the case. The NHDP has been trundling along in jumps and starts under the UPA, but it has virtually stalled in 2008-09. The biggest roadblock had been the contentious bidding criteria that kept away many potential bidders, resolved only recently.
The Rs 9,000 crore New Delhi Railway Station modernisation programme was another victim. The railway ministry came out with the first request for qualification in October 2007. But policy makers? blind spot played spoilsport here as well? contentious bidding clauses forced the RFQ to be scrapped, fresh bids could only be called by October 2008 and yet, the project hasn?t been awarded. Similarly, of the nine port projects that were to be bid out in 2008-09, the PPP appraisal committee has given its approval to only four, but they are yet to be awarded.
Bankers, construction companies, consultants, even the government?s think tank has been pointing out that financing an infrastructure project is not as big a problem as the need for a ?shelf of bankable? projects. But this could only happen if nodal ministries had enough foresight in the 56 months UPA has been in power.
surabhi.prasad@expressindia.com