Taking note of the ongoing disputes in highways sector, Finance Minister P. Chidambaram has proposed setting up of an independent regulatory authority, a move which was welcomed by highway developers.
“Setting up of regulatory body to clear pending disputes related to land acquisitions and environmental hurdles,” said M. Murali, Director-General, National Highways Builders Federation (NHBF).
“The formulation of an independent regulatory authority for the road sector is a welcome move,” echoed Mukund Sapre, Executive Director, IL&FS Transportation.
In the backdrop of some developers looking at the exit mode citing delayed Government clearances and many unable to tie-up finances for their projects, the Finance Minister said, road construction sector faces challenges not envisaged earlier, including financial stress, enhanced construction risk and contract management issues that are best addressed by an independent authority.
“Hence, the Government has decided to constitute a regulatory authority for the road sector,” he said.
DROP IN TARGET:
In the backdrop of a sharp drop in award of highway projects, Chidambaram also steered clear of proposing any ambitious road construction targets for next fiscal, a departure from earlier Budget announcements.
He said that 3000 km of road projects will be awarded in the first six months of 2013-14, which is much lower than the usual yearly target of 7000-8000 km announced in budgets in the last two years.
Actual national highway project awards are much lower, with below 2000 km projects awarded till date.
“Bottlenecks stalling road projects have been addressed and 3,000 km of road projects in Gujarat, Madhya Pradesh, Maharashtra, Rajasthan and Uttar Pradesh will be awarded in the first six months of 2013-14,” Chidambaram said today.
He also said that he will seek the assistance of the World Bank and the Asian Development Bank to build roads in the North Eastern States and connect them to Myanmar.
However, NHBF expressed its disappointment over many other demands of the sector, that have not been addressed.