The Prime Minister?s Office (PMO) is now monitoring the pace of completion of infrastructure projects. On Friday, the PMO reviewed key infrastructure ministries to ensure that contracts are awarded timely and projects are managed better.
The meeting by Manmohan Singh?s team is significant as analysts have noted that India is likely to fall short on achieving completion deadlines for several key projects in 2011-12, the final year of the Eleventh Plan.
PMO principal secretary TKA Nair met the secretaries of key infra ministries, including road, shipping, civil aviation and railways, as part of this exercise.
The meeting follows an earlier one this week with secretaries of textile, commerce and corporate affairs among others.
Singh has begun a review of the achievements of the different ministries to remove the perception that the government has eased up on achieving the growth targets for the economy after the corruption scandals broke out.
?The key message from PMO was to expedite the award process and ensure proper management of projects so that time and cost over-runs can be avoided,? a senior official who attended the meeting told FE, requesting anonymity. The latest project implementation report of statistics ministry shows there is a delay of upto four years in completion of some rail and road projects, resulting in increase in cost by around 20%.
Singh has also reviewed the performance of nine key ministries including coal, power, petroleum with the objective early this month to fast track decisions on critical policy issues that have held back growth in these sectors.
While he has asked that the MMDR Bill must be introduced in Parliament in the winter session, he has also asked for the Companies Bill to include clauses for representation of women in the board of directors of companies.
For the textile sector, he has directed that technical textiles (bullet-proof and fire-proof jackets and similar items) should be designated as sunrise sector. This means it will get facilities like tax relief for depreciation.
Friday’s meeting is important in the wake of formulation of strategy for 12th Five Year Plan, which starts from April 2012. The government wants to double infrastructure investment in the Twelfth plan to $1 trillion against $500 billion in the current plan. Half of the new investments is projected to come from private sector, which is looking for profitable opportunities in the infra space. Private sector outlay in the current plan, or eleventh five year plan, is expected to be 36%.
?Project management, to deliver on time and within cost, is a learnable capability that can be institutionalised, as demonstrated by the development experiences of Japan, Korea, Singapore and China. A nationwide drive to improve project management must be an integral part of the twelfth Five Year Plan,? Planning Commission says in draft approach paper for twelfth plan.
India is unable to meet the infrastructure investment target for port, railway and road sectors that are considered to be the lifeline of any economy for their importance in movement of goods. Looking at the slow progress till last year, the government had revised the targets set for these three sectors by up to 50%. However, the government is positive it will attain the investment figure of $500 billion helped by telecommunication and oil & gas pipelines that have seen more than estimated private interest.
?The pace of investment has been particularly buoyant in some sectors, notably telecommunications, oil & gas pipelines, while falling short of targets in electricity, railways, roads and ports,? the draft of approach paper states.