The ambitious National Highways Development Programme (NHDP) came to a virtual standstill during the first nine months of the year due to differences between the ministry of shipping, road transport and highways and the finance ministry over the setting up of the public private partnership appraisal committee. The model concession agreement for construction (MCA) of national highways also had certain clauses which led to problems between potential bidders and the NHAI. The ministry did not award any highway projects till September and it was only from October that the sector saw any movement. NHDP phases V and VI got Cabinet approval in the month. The deadlock over the PPP-AC broke and on November 1 it cleared nine highway projects for award.
Problems in the MCA were also resolved and in December it was decided that the land acquisition clause would be reduced to 50% from the original 80%. Diametrically opposite, the road transport department became a hotbed of activities to enhance road safety. The department set up a committee under Teris S Sundar to revamp road safety laws. Major changes to the Central Motor Vehicle Rules are also on the anvil. Shipping and ports sector has also been a slow mover in 2006, mainly due to a deadlock between the planning commission and the ministry over the MCA for ports. The bone of contention is the system of tariff fixation and the model of revenue sharing. The plan panel wants a new more competitive system of fixing tariffs while the shipping ministry is pitching for the current cost plus model. The issue has dragged on through out the year and now industry players are hoping to see it resolved by early next year. As a result, the ministrys hopes of getting private participation is largely unfulfilled.
However, development activities in the sector have not taken a backseat completely. A National Maritime University is to be set up to overcome the shortage of sailors. If all goes well, the year 2007 should see the sector hotting up, especially NHDP. The government has promised to finish the much delayed golden quadrilateral by next year as well as award the remaining projects in NHDP phase II. NHDP phases III and V are also likely to see a lot of activities. However, the expressways (a part of NHDP-VI) will have to wait until 2008. The MCA for ports should also be finalised by early next year and the government would then be able to embark fully on its National Maritime Development Programme to develop were around 276 projects for the port sector and 11 for the ship sector.