India Infrastructure Summit 2012 ‘Accelerating Implementation of Infrastructure Projects’ 31 August 2012 – FICCI, Federation House, New Delhi-01

Mr Hemant Kanoria, Chairman, Dr Rajiv Kumar, Secretary General, FICCI, Members of the FICCI National Committee on Infrastructure, Investors Friends from Industry, Developers, Concessionaires, Bankers, Lenders and financial Institutions and last but not the least my friends from the Print and Visual media, Ladies and Gentlemen

I am delighted to be here for the fourth edition of India Infrastructure Summit-2012 organized by FICCI. I am pleased to note that the central theme of the Summit is ‘Accelerating Implementation of Infrastructure Projects’, and a number of significant areas are expected to be deliberated upon by various experts in the business sessions.

I am aware that this annual summit has, over the years, provided a platform for the industry, the Government and other stakeholders to get together and deliberate on the challenges being faced by the sector it’s a platform where new ideas are explored. I would therefore not like to repeat what you already know about the sector nor would I like to harp on the pro-active policy initiatives already in public domain. I would like to exhort you to participate in the Infrastructure development with increased enthusiasm, which was amply evident in the awards of NH projects in the year gone by. I would be very happy if you could come out with the possible reasons for the recent sudden slow down. As partners in this sector, it is imperative that we put our heads together and resolve issues, if any that are hindering the progress.

In order to accelerate implementation of major investment projects, our Prime Minister himself has taken the initiative of an “Investment Tracking System”. Further, a detailed roadmap has been worked out for the flagship infrastructure projects in key sectors including the road sector, as our Government is committed to abridge the huge Infrastructure deficit.

You already know the impact of the serious and concerted efforts made by the Government post recession which led to continuous improvement of awards of projects from 639 Kilometres in 2008-09 to 3360 Kilometres in 2009-10 followed by 5082 Kilometres in 2010-11. I am happy to inform you that the financial year 2011-12 has been an outstanding year for the Indian Road Sector. A record length of 7957 Kilometres of National Highways were awarded for strengthening/upgradation and improvement and over 2200 Kilometres were completed during the year 2011-12.

This has been the highest ever achievement so far for the nation since independence and I would like to compliment the role played by the Infrastructure Industry in effecting the same. The targets that we have set for ourselves in this sector are ambitious but we have in the recent past surpassed our earlier performance emphatically. This inspires us to fulfill the challenging targets in the days ahead. This year we have planned to award 9,500 Kilometres of National Highways for widening and upgradation. I am fully conscious that this can only be achieved when we synergize our efforts in a positive and pro-active manner.

I wish to inform you all that we have recently got the approval of Cabinet Committee on Infrastructure for awarding the already completed projects in the NHAI domain on Operate-Maintain-Transfer or OMT basis. We have also planned to award road projects covering around 4,000 kilometers for better maintenance primarily under OMT mode through the Public Private Partnership route. This would not only help improve the existing roads with better maintenance, leading to higher level of users’ satisfaction but also open a new line of business for OMT Concessionaires.

Also, with the active participation of Planning Commission and Ministry of Finance we have evolved and formulated the “Engineering, Procurement and Construction or EPC Contract”-Agreement document to enable the contractual framework for construction of highways in an efficient, economical and competitive environment. I am extremely glad to inform you that the Cabinet Committee on Infrastructure has recently accorded its approval to the EPC Contract document. It will minimize, if not eliminate, the time and cost over-runs characteristic of the extant Item Rate Contracts. Further, this will enable a faster roll-out of projects with least cost and greater efficiency & flexibility encouraging Contractors to participate in such projects.

The EPC mode of execution shall ensure implementation of the road projects to specified standards with a fair degree of certainty relating to costs and time while transferring the design & construction risks to the contractors. We are planning to award 4,000 Kilometres of Highway projects under the EPC mode contract this year. These projects will primarily aim at two-laning of single-laned roads on existing right of way thus not involving much Land Acquisition.

For PPP projects, tolling has been a bone of contention between different stakeholders in the sector. While several issues related to the quantum of tolling have been sorted out, we are trying to resolve the left over issues as well. To infuse efficiency, electronic toll collection (ETC) is being encouraged and facilitated by the Government. In this regard, the country’s first RFID Technology Based Electronic Toll collection Plaza at Chandimandir near Panchkula in Haryana had been inaugurated earlier this year. We are committed to make all toll plazas, RFID compliant by January 2014.

Coming to the related disputes in the sector, I am aware that around Rupees Eleven Thousand Crores have been stuck up in disputes in the roads and highway sector. This is a cause for concern and the Government has taken serious measures to resolve these issues at the earliest by conforming to the report of the BK Chaturvedi Committee for faster resolution of pending disputes pertaining to National Highways Development Project (NHDP) works.
Further, an Independent Expert Group has also been constituted comprising former Chief Justice of High Court as Head and former Deputy Comptroller & Auditor General, former Vigilance Commissioner among others.

Before concluding, I would like to mention that recently the National Road Safety Policy has been approved which includes promoting awareness, establishing road safety information data base, encouraging safer road infrastructure including application of intelligent transport systems, enforcement of safety laws, setting up of state road safety councils and district road safety committees etc. Besides these, road safety has been made an integral part of road design at planning stage, safety audits of selected stretches of National Highways/ Expressways are being conducted, safety standards of vehicles are being enforced categorically, and publicity campaigns on road safety awareness are being taken up among others.

I would like to categorically highlight here that in order to enhance the road safety on national highways, we have directed that project designs, while meeting safety standards, provide for various measures to enhance the Road Safety like segregation of local and through traffic by constructing flyovers, underpasses, bypasses, service roads etc. Safety features like road markings, adequate and all weather visible signages, crash barriers, raised pavement markers etc are provided. Safety of pedestrian is of great importance and pedestrian facilities like zebra crossings, pedestrian underpasses, foot over bridges, pedestrian guardrails etc have to be necessarily provided. Ambulances are being provided at an average stretch of 50 km on National Highways entrusted to NHAI and tow away cranes are available at every toll plaza. New locations have been identified for development of wayside amenities.

In order to track the progress of construction and maintenance of national highways, a state of the art system is being developed to capture information, photos & videos directly from the site using tablet, notepad & personal digital assistant or mobile phones and its retrieval on desktop & laptop by all concerned on real time basis. This will make monitoring of projects more prompt and responsive at different levels.

Friends, I once again highlight the commitment of the Government to build road infrastructure, even at the cost of repetition the initiatives that we have consistently taken to achieve our dream of building 20 Kms per day. But today, I am concerned when I hear bids are not being received or only single bids are being received in well structured projects. We have made earnest efforts to understand the reasons thereof and wish to resolve the issues. I hope today’s deliberations will bring about some fresh insights and policy inputs to take the infrastructure sector forward.

Last but not the least, I would like to thank FICCI for inviting me to this forum and congratulate FICCI for organizing this important Summit. I wish the conference all success.