Govt to award Rs150,000 crore projects in the next 6 months

To bring the economy back on the growth path, projects worth Rs 150,000 crore will be awarded in the next six months, based on projects identified by the Prime Minister’s Office in consultation with the Planning Commission.

These are spread across sectors such as railways, expressways, ports, airport and power & transmission.

And here’s the wet blanket: that number is not even 10% of the targeted Rs 55 lakh crore of investments envisaged in the Twelfth Five-Year Plan (2012-17).

The projects that have been identified are Rs 30,000 crore Mumbai elevated rail corridor, two locomotive engine factories worth Rs 5,000 crore, eastern dedicated freight corridor (Rs 10,000 crore), expressways (Rs 25,000 crore), two ports (Rs 10,000 crore), two airports (Rs 20,000 crore), and power & transmission projects (Rs 40,000 crore).

The government is confident the projects will be awarded in the desired time limit.

“We reviewed the infrastructure projects and decided that these can be awarded in the next six months after taking approvals from the Cabinet,” said Planning Commission deputy chairman Montek Singh Ahluwalia.

As per the plans, two new international airports at Bhubaneshwar and Imphal come up, while 50 low-cost small airports will be taken up by the Airports Authority of India (AAI).

Eight greenfield airports will be taken up in this year on PPP mode at Navi Mumbai, Juhu, Goa, Kannur, Pune, Sriperumbudur, Bellary and Raigarh.

Experts, though, feel that the promises being made will run into policy hurdles.
“Projects such as the Navi Mumbai airport have been stuck over environment clearance for over a long time now. Also existing guidelines prohibit two international airports within a radius of 150 km. It is the policy issues such as these that need to be tacked first,” said Vishwas Udgirkar, partner (infrastructure), Deloitte.

Policy inconsistencies on the highway front have already brought highway construction to a grinding halt. Merely 1,000 km of highways have been awarded in 2012-13 against.

And the Planning Commission’s commitment for expressways worth Rs 25,000 crore is not the idea that the industry is ready to buy.

An industry representative who did not wish to be named told dna, “The ministry of road transport has not been able to fix a model for expressway development.

On what basis is the government talking about this massive funding on expressways in six months? Also, banks finance highways for 12-15 years.

Where are the norms for pension and insurance fund investment for long term finance that will sustain expressways for 30-40 years?”

The two port projects will come up at Sagar (West Bengal) and Durgarajapatnam in Andhra Pradesh. In railways, the tariff authority will be brought to Cabinet soon.