More realistic targets this fiscal, claims road ministry

Timsy Jaipuria & Prashant Mukherjee New Delhi, April 8: After missing deadlines to award road projects by a wide margin last year, a cautious ministry of road transport and highways has informed the Planning Commission that it will present a more realistic picture of the sector. The ministry said it will finalise two sets of targets this fiscal ? one that can be achieved in the current scenario and another that can be met if all the regulatory hurdles are eased. The move comes after a poor performance by the roads sector last fiscal where against a target to award over 9,000 km of projects, the NHAI was able to award a mere 1,540 km. Sources said at a review meeting of the infrastructure sector taken by Planning Commision member BK Chaturvedi on Wednesday, the officials of the road ministry refused to give any specific targets for awarding road projects and asked the commission to resolve the hurdles first before it can make a definite assessment about the progress of projects. It has, however, agreed to come back to the commission in a fortnight with some numbers. "We will come back to the commission in 15 days to submit our plan. We have explained how the sector is stung by the slowdown in the economy and various environmental and financial hurdles faced by developers and investors." a senior road ministry official said. The officials said the sector is plagued by project delays and poor investor interest. It was in fiscal 2012-13 that highways construction and expansion increased to 5,800 km as against 4,955 km in 2011-12, which was the only relief for the sector. Out of the 5,800 km, nearly a half, 2840 km, was completed by the National Highways Authority of India (NHAI). The officials also discussed various steps need to be taken to revamp investments in the sector. The issues of stranded projects locking up funds, equity and sticky issues of remunerative return to investors were also taken up. Discussions also took place on the need for credit enhancement facility and exit equity policy easing.

After missing deadlines to award road projects by a wide margin last year, a cautious ministry of road transport and highways has informed the Planning Commission that it will present a more realistic picture of the sector. The ministry said it will finalise two sets of targets this fiscal ? one that can be achieved in the current scenario and another that can be met if all the regulatory hurdles are eased.

The move comes after a poor performance by the roads sector last fiscal where against a target to award over 9,000 km of projects, the NHAI was able to award a mere 1,540 km.

Sources said at a review meeting of the infrastructure sector taken by Planning Commision member BK Chaturvedi on Wednesday, the officials of the road ministry refused to give any specific targets for awarding road projects and asked the commission to resolve the hurdles first before it can make a definite assessment about the progress of projects. It has, however, agreed to come back to the commission in a fortnight with some numbers.

“We will come back to the commission in 15 days to submit our plan. We have explained how the sector is stung by the slowdown in the economy and various environmental and financial hurdles faced by developers and investors.” a senior road ministry official said.

The officials said the sector is plagued by project delays and poor investor interest. It was in fiscal 2012-13 that highways construction and expansion increased to 5,800 km as against 4,955 km in 2011-12, which was the only relief for the sector.

Out of the 5,800 km, nearly a half, 2840 km, was completed by the National Highways Authority of India (NHAI).

The officials also discussed various steps need to be taken to revamp investments in the sector. The issues of stranded projects locking up funds, equity and sticky issues of remunerative return to investors were also taken up. Discussions also took place on the need for credit enhancement facility and exit equity policy easing.