@sureshprabhu & Rlys fight back on criticism of low capex spend by achieving Rs 94,000 cr spend last fiscal—against Rs 37,000 cr prev year.
Railways’ stunning capex revival
In the light of the Railways’ improved performance on the capex spending front, the Prime Minister is believed to have assured the Railways enhanced Gross Budgetary Support of up to Rs 60,000 crore if it continues the trend.
Rs 18,300 cr of Transmission projects bid out in 2015-16 against expectation of Rs s100,000 cr. Hopefully, backlog will +ively impact this year.
Transmission projects lag behind
A total of 13 projects were auctioned under tariff-based competitive norms in 2015-16. However, the enhanced level of activity currently under way is expected to help achieve the ambitious target of R1 lakh crore worth of fresh investments.
MORTH trying hard to introduce Road Safety Bill in Parliament. States reluctant to have tax powers curtailed but ok with other features.
Hurdles to Road Safety Bill
A high-level panel has suggested that the government hive off ‘taxation issues’ to remove hurdles to the enactment of the Road Safety Bill. This would enable the Bill to focus on issues such as prevention of drunk driving, minors behind wheels, professionalisation of driving schools, issuance of drivers’ licences as well as better engineering of roads with a view to safety.
India Ratings Study: Construction firms saw negative cash-flows from operations in 2015-16; likely to be marginally positive in 2016-17.
Rebuilding cash flows and revenue streams
According to the India Ratings Study, the negative cash-flows from operations are a legacy of the aggressive bidding in FY2010-12 when companies focused on building their order books. The study pointed out that, going forward, improvement in cash-flows and moderate growth in revenues can be envisaged.
MORTH Road Stats Roundup: 2016-17 versus 2015-16: Construction ~ 15,000 km vs 6,000 km. Awards ~ 25,000 km vs 10,000 km. Aggressive!
Highway to economic growth
The target for road construction in 2016-17 has been set at 41 km per day, up from the current 17 km per day. The overall budget of the roads ministry has seen a rise of 31% in 2016-17 to R57,976 crore from R44,255 crore in 2015-16.
Amendments to Compensatory Afforestation Fund Bill 2015 cleared. Promoters of projects on forest land contribute. Already at R40,000 crs!
Clearing the decks for fund utilisation
With the enactment of the legislation, the decks have now been cleared for urgent utilisation of accumulated unspent amounts available with the ad hoc Compensatory Afforestation Fund Management and Planning Authority. The funds could go a long way in creating productive assets and generating employment opportunities in the backward rural areas.
Coal India’s strategy of 1 job/2 acres acquired art of d possible. Allowed unprecedented land acquisition thereby s mining.
Coal India’s smart strategy
Coal India’s record production of 637 million tonnes was made possible due to the acquisition of a whopping 10,000 hectares of land in the past two years. States cooperated once they were told more mining equals higher revenues via royalty.
Govt cuts fuel cess allocation to NHAI. Fuel cess was to be ringfenced for road building. Is it being gobbled up to reduce fiscal deficit?
NHAI’s cess hurdle
The road transport ministry has informed NHAI that it will provide only Rs 2,000 crore as its share of fuel cess this year compared to Rs 15,000 crore last year. While NHAI needs Rs 65,000-70,000 crore for the current financial year, its sources of revenue, including toll charges and cess, will add up to roughly Rs 10,000 crore.
—Vinayak Chatterjee is Chairman of Feedback Infra
His Twitter handle: @Infra_VinayakCh
A weekly selection of the author’s tweets—
with a brief backgrounder—in the infra space, by Adite Banerjie