Good move to give Infra Status to logistics sector. Was long overdue and clearly justified for hard investments in warehousing, logistics parks, cold-chains, inland container depots, dry ports, railway freight terminals et al. Reduces interest costs & enables borrowing from IIFCL
Infra status for logistics will help exports: Logistics cost of Indian exports is high, marring competitiveness. The move could give exports a boost; with cold chain also considered logistics, it could help ease perishables’ prices too.
Asset Reconstruction Cos (ARCs) get a shot in the arm with fresh RBI guideline. Allows ARCs to hold more than the hitherto allowed 26% of the equity of stressed entities. Gives much greater freedom to ARCs to manage the resolution process, & makes ARC business more attractive
Equity boost for ARCs: The 26% cap has been removed for ARCs that are consistently maintaining net-owned funds of `100 crore. Equity acquired will be valued at least once a month & be marked-to-market.
When SBI Chairman Shri Rajnish Kumar says that SBI is looking forward once again to expand loan book in 3 Rs—Roads, Railways, and Renewables—then it is quite clear that the infra rebound is well underway. NDA strategy of pushing public exp since 2014 playing out well
Banking on infra again: The PSB recap decision will give banks enough thrust to look at loans to infrastructure, which will be also buoyed by increased public spending focus.
Land for infra: Clearly d Land Acquisition Act was not off d mark when it proposed a compensation of 4X market rate for acquisition of rural land. Maharashtra not only gives 5X but has now sanctioned 5X for peri-urban & suburban areas too. Otherwise, infra projects getting stuck
Land compensation to speed up projects:The move is likely to speed up acquisition of land for projects like the `46,000-crore Mumbai-Nagpur expressway where the government is looking to acquire 10,000 hectares.
Interesting situation in steel rails. Indian Rlys convinced that domestic manufacturers alone cannot supply for its aggressive track renewal program, linked to safety issues also. Steel Ministry quite unhappy with this ‘aberration’ of domestic purchase preference policy
Meeting Railways’ steel appetite: Railways issued a global tender for 717,000 tonnes of steel in October, sticking to its plan despite opposition from steel ministry. Now, a government panel has reportedly said there is enough production in India to meet Railways’ requirement.
In spite of a stated intention by d authorities some time back to eliminate coal imports, tracking reports suggest that coal imports are rising. Reason—the blip in domestic coal supplies coupled with ban on use of polluting pet-coke (largely used in the cement industry.)
A hefty coal bill ahead?: Ban on pet coke means cement makers have to import coal. Imports rose >40% y-o-y in each of last 7 months, because of greater Chinese demand & thinner than before global supply.
Clarity reqd on CEZs: What exactly is the USP in promoting 14 Coastal Eco Zones. Are they going to be truly free trade zones with freedom from domestic regulations to give a huge advantage to exports? Or just large industrial parks with better infra & port connectivity
CEZ vision needs clarity: Mega-CEZs envisaged under National Perspective Plan of the Sagarmala provide a business-friendly ecosystem, including faster approvals and ease of doing business.
With d kind of challenges, CivilAviationMin is facing on ramping up choked Airport infra, indeed surprising that there is no strategy unfolding on vigorously re-energizing the PPP thrust. 25 of 126 AAI Airports have reached saturation & Rs 4 lac crs reqd for 100 new airports!
Airport development needs pvt sector: Airport development policy seems cagey about partnering private sector. AAI is ready to issue bonds to raise Rs 5,000 cr to build seven Greenfield airports upgrade 46 existing ones.
A weekly collection of the author’s tweets—with a brief backgrounder—by Sarthak Ray