SEBI’s Proactive Step: A slew of measures have been taken by RBI to get more long term finance into Indian infrastructure such as the Infrastructure Investment Trusts and REITs (Real Estate Investment Trusts). SEBI also opens up a new window for the sector.
Tweet: SEBI’s reclassification of Core Investment Cos in Infra sector as a special category of NBFCs will now allow Foreign Venture Cap cos to invest.
Refusing To Read The Writing On The Wall: Railway unions continue to be opposed to PPP and FDI. The new proposal by the unions is ostensibly part of an effort to help the railways ministry raise Rs 50,000 crores to fund a host of maintenance works that the Railways is unable to finance due to declining revenues.
Tweet: Unprecedented: 2 major Rly unions have offered their members’ Rs 10,000 cr Provident Fund balance @10.5% as alternative to privatization & FDI.
Fast Tracking Port Connectivity: The Port Infrastructure Vikas Nigam, to be set up with a paid up capital of Rs 50 crores and equity participation of 12 major port trusts, is expected to improve linkages of ports with the railways network. PSUs under the administrative control of the Railways are also going to be part of the plan.
Tweet: Looks like the spate of new PSUs being announced like “Port Infra Vikas Nigam” part of Govt’s strategy to get state to recharge infra dvpt.
Neeti Aayog To Replace Planning Commission: This closes the chapter of socialist era planning and the new government’s announcement of doing away with the Planning Commission. Each of the four divisions is expected to be headed by a Secretary level officer.
Tweets: ‘NEETI AAYOG’ – the new avatar of Plng Comm to have 4 pillars: Direct Benefits Transfer, UIDAI, Inter-state Councils & Prog Evaluation.
Tweets: Ambit of NEETI AAYOG reflects the transfer of jurisdiction of Plan Expenditure to Finance Ministry. Plng Comm’s financial clout removed.
Powerless Regulator? The move to set up a Green Regulator is an outcome of the Supreme Court’s order to set up an autonomous body for appraising projects. Currently, only courts can impose penalty on basis of complaints filed by authorized officers. An amendment to the law would be necessary to hand over powers to government officials.
Tweet: No point making it ‘toothless’. Proposed Green Regulator is to have powers to appraise & clear projects, but not have any penal powers.
Strengthening Regional Ties: The SAARC summit focused on deepening cooperation in core areas of trade, investment, finance, energy, infrastructure and connectivity.
Tweet: With agreements on rail, road and power connectivity, SAARC may actually start looking like Europe in a few years time. Good Eco Diplomacy.
Huge Losses Due To Shoddy Road Management: Economic costs due to delays at checkpoints and toll plazas are about 20 times more than the collections of about ₹4364 crores, according to a study by IIM Kolkata. The study finds that the delays result in losses of upto ₹27,000 crore nationally. The extra fuel spent on slowing down and stopping amount to an additional ₹60,000 crores.
Tweet: IIM Kolkata study says universalizing Elec Tolling will save ₹87,000 cr/yr in idling fuel etc. Add “no diversion” of toll plaza cash. Huge.
Need For Speed: India is exploring two corridors for high speed trains. Japan is conducting the feasibility study for the Bullet train project in Mumbai-Ahmedabad corridor. China will do the same for the DelhiChennai route and the estimated cost is US $32.6 billion.
Tweets: Proposed 1754 km (6 hour) High Speed Rail between Delhi & Chennai would be quantum jump for Indian transportation & Chinese rail tech export.
Expert opinion: ₹90,000 crore Mumbai-Ahmedabad high-speed rail projects not viable as PPP. Will have to be publicly funded. Challenging.
BHEL’s Russian Foray: BHEL will set up the two power plants in Ulan-Ude. The total investment in the project is expected to be in the range of $600 million. The deal is part of an agreement between the two countries to settle the debt that India owes to Russia.
Tweet: India indeed emerging as Super Power: now BHEL to set up 2 coal-thermal power plants in Russia of 240 MW capacity each.
– Vinayak Chatterjee is Chairman of Feedback Infra. Twitter: @Infra_VinayakCh A weekly selection of the author’s tweets— with a brief backgrounder—in the infra space, by Adite Banerjie