December 24, 2013
Business Standard Editorial Comment | New Delhi
India’s highway-building programme is in crisis. This is partly due to its very ambitious scale, which means that public funds are not adequate to meet the programme’s demand for capital, given the swiftness with which roadsneed to be rolled out. There are other reasons as well. The crisis is also caused by the government’s inability to design auctions that eliminate unrealistic bids and delays that, in some cases, are a direct outcome of tardy clearances and regulatory hassles. The road sector’s problems have also arisen because the government’s private sector partners failed to take into account the effect a growth slowdown would have on their revenue, or were too ambitious in their forecasts. Thanks to a combination of these factors, not even a single build-operate-transfer (BOT) project was awarded in the first six months of the ongoing financial year, indicating the degree to which the private sector has soured on road-building. Basically, nobody wants to touch it.
In October, the government set up a panel under the chairman of the Prime Minister’s Economic Advisory Council, C Rangarajan, to figure out if there was a way out of this conundrum. The panel had some difficult decisions to take. In particular, many existing highway concessionaires wanted to defer the premiums that were due to the National Highways Authority of India, or NHAI, under the BOT system. The premium, which can range from Rs 3 crore to Rs 680 crore a year, is to be paid out over 20 to 25 years, increasing by five per cent every year. The total premium due over the next few decades is Rs 1.5 lakh crore. But the fact that revenues have not matched estimations means that many companies are grumbling about having to pay out. The government, meanwhile, alert for once to the concern that the private sector is trying to feather its own nest at the expense of the public exchequer, may reportedly want to cut off the payment of dividends by road-building companies – usually special purpose vehicles, or SPVs – to their parent company as long as premiums to the NHAI are still outstanding. Another possibility that the Rangarajan panel is considering is reducing the upfront payment of premiums for the next few years by a fixed proportion – 75 per cent, in fact. The NHAI has already argued for a low discount rate and against penalties for private developers.
It is certainly true that the private sector must stay involved in road-building in India. The government cannot pay for everything. And something must be done to enable stalled projects to move forward. However, an arbitrary and opaque mechanism is a very bad idea; nor should the private sector be allowed to dictate terms. The government must take account of the fact that just giving into demands for renegotiation sets up a severe moral hazard problem, and that it also renders past auctions unfair and future auctions problematic. Thus, two criteria should be front and centre in the final decisions taken by the government. First, the mechanism for dispute settlement should be transparent, consistent and independent. Second, it should not unduly benefit the private sector. In fact, there should be clear penalties – regardless of the request from the NHAI – for anyone who has delayed a project. This should include the government, since in some cases private developers have suffered because the government has sat on clearances for five years. Transparency and financial accountability are essential to clean up India’s vital roads sector.
December 18, 2013
Shalender Kalra, Hindustan Times | Nahan,
After a probe into the alleged irregularities in the widening of the Kumar Hatti-Nahan road project, the quality and design wing of the Public Works Department (PWD) has reportedly given it a clean cheat.
During his visit to Sarhan on September 17, Himachal Pradesh chief minister Virbhadra Singh had ordered PWD superintendent of engineer (SE) to conduct a probe into the 75-kilometre-long World Bank-aided project, which is expected to come up at the cost of Rs. 142 crore.
Sources placed with the PWD said following the CM’s order a team headed by the SE (quality and design) inspected the road and collected samples of the materials used.
The probe report further stated that the work was carried out as per the parameters set by the detailed project report (DPR).
When asked, PWD SE (quality and design) BB Bhardwaj confirmed that the quality of the construction was found satisfactory, adding that the collected samples also passed the lab test.
He further said the construction of the road was in progress according to the DPR.
However, RIDC official Naresh Sharma said it was just rumour that the work was not being done properly and the norms were violated.
Arguably, the project entails an environmental cost – as many as 11,606 trees were laid down for the widening of the road.
In all, 33 months have been granted to Delhi-based Som Dutt Builders to finish the project, which was over in July 2012. The Road Infrastructure Development Corporation (RIDC), the executive agency of the project, has fixed a fresh deadline of March31st, 2014 for the completion of the project.
The issue of the shortcomings in the widening of the road was also raised in the Himachal Assembly a few months back. Now the road has been declared fit for plying the traffic within the speed limit of 40-45 km per hour.
The villagers had also raised their objection to narrow turns of the road.
December 9, 2013
J Abbas Mulla, TNN
HUBLI: Fed up with the delay in eradicating unscientific road humps from roads in Hubli-Dharwad, members of an NGO here filed a Public Interest Litigation suit against civic authorities.
Claiming that these road humps have caused many motorists to suffer from neck pain, slip disc, fractures of the vertebra and other health problems, Sadbhavana Samiti members served notice under Section 482 of the Karnataka Corporation Act to commissioner Hubli-Dharwad Municipal Corporation (HDMC) on July 18.
On November 21, Dr KH Jituri, 77, Dr Abdul Kareem Patwegar, 62 and businessmen Sanjay Shetti and Jeetendra Thakkar filed the suit in the court of the 1st Additional Civil Judge, making the HDMC commissioner and district deputy commissioner party to the suit.
Senior advocate and Samiti trustee GR Andanimath said, “The court accepted the submission on November 29 and the next hearing is on December 19.”
Dr KH Jituri said, “Every day, no less than 5-10 accidents occur only because of unscientific road humps and we’ve seen an increase in patients with severe health problems due to them.”
When the problem was brought to the notice of the HDMC commissioner, he assured the problem would be sorted out soon, but no action has been taken, he added.
Samiti secretary Sanjay Shetti said, “We had no alternative but to go to court. Despite our notice, HDMC didn’t even try to solve the problem and therefore filed a suit in court.”
According to HDMC sources, there are over 500 road humps in the twin cities and less than 20 are scientifically designed.
December 2, 2013
Dipak Kumar Dash,TNN |
NEW DELHI: A former NHAI official is set to be booked for “misguiding” the authority’s ex-chairman to allow shifting of two toll plazas on Panipat-Jalandhar stretch of NH-1. After an inquiry committee of NHAI recommended action against the official last month, highways minister Oscar Fernandes okayed filing of an FIR against him.
The NHAI inquiry found that “then member (projects) S I Patel had misguided” then chairman by suggesting in the file that the shifting of two toll plazas was as per contract conditions. It said the decision was against “public interest” and would have allowed the private developer to maximize toll collection.
In fact, the decision to allow shifting of toll plazas was a glaring one as both NHAI and its independent consultant had rejected the proposal thrice in March, April and May 2010. But only a month later, the consultant recommended the shifting of toll plazas “subject to approval of competent authority”. Two months later, then NHAI chief Birjeswar Singh gave in-principle approval.
This inconsistency in NHAI decisions also came under criticism from the Supreme Court where the case of shifting of toll plazas is being heard.
NHAI sources said the role of five more officials and the independent consultant is being investigated and appropriate action would be taken after the court proceedings.
Patel, a retired engineer from Gujarat, was earlier named by CBI for allegedly favouring a private company in tender allotment for widening of Nagpur-Betul highway. But the highway ministry never cleared CBI’s requests to prosecute him.
November 26, 2013
Tension prevailed when the demolition squad reached the area in the morning. Locals staged protest, alleging that the eviction drive was illegal. “The authorities had not served us any notice to vacate the land before carrying out the eviction. We have been staying in the area for the past so many decades and suddenly they came and evicted us. It is unfair,” said Sabitri, a resident of the area. To avoid any untoward incident, the district administration deployed eight platoons of police at the spot.
The authorities refuted the allegations. “In June last year, we had carried out eviction in the area but the evictees re-encroached on the lands. Due to fresh constructions, we were not able to move ahead with the road project,” said a government officer.
He said the drive was undertaken according to direction of the Orissa high court. During the first-phase eviction drive, seven persons were injured in a clash between slum dwellers and policemen.
November 16, 2013
Niraj Chinchkhede, TNN |
The waqf board had approached the tribunal seeking the civic body to temporarily restrain from doing any sort of construction work in the waqf suit property at survey number 6, 7/2, 8 and 31 in Old Qutubpura, Jaisingpura (Cantonment).
In its petition, the Idgah and Kabrstan Committee claimed that the civic body had commenced the work without taking a no-objection certificate from the owners of the land – the waqf board. Abdul Hameed Khan, secretary of Idgah and Kabrstan Committee, the land was reserved for a graveyard. “However, the municipal body had encroached the front portion of the land measuring 600 ft X 15 ft, thereby violating the norms. The market value of the encroached land is in crores and the civic body should compensate the owners before taking its possession,” he said.
Khan said he had raised objection over the construction work in 2008. “At that time, the municipal body had promised that it would measure the actual length of the land coming in way of road widening and offer compensation for the same. However, the civic body has now started the work without even giving any compensation,” he said.
After conducting survey of the site, the Idgah and Kabrstan Committee members and a group of Muslim community people said the work of periphery wall of the graveyard was not being done abutting the road. “The authorities have pushed it about 15 feet inside the graveyard to widen the road. But there are number of graves in the 15-feet area. While doing excavation, the municipal body is also digging skeletons which is highly objectionable,” Khan said.
The municipal corporation had recently started construction work of the road with an investment of Rs 12.5 crore. After allotting the tender to a contractor, it took the civic body six months to actually start construction work on the development plan road connecting Town Hall and Little Flower School.
Contending that there is substance in the application, the tribunal also issued a show-cause notice to the municipal body.
The civic body officials refused to comment on the issue.
November 15, 2013
Dipak Kumar Dash, TNN |
NEW DELHI: Highway minister Oscar Fernandes wants to implead himself in the case on the Panipat-Jalandhar highway widening case which the Supreme Court is hearing.An official note was moved in the NHAI saying the minister “desired to appear before the Hon’ble Supreme Court of India for early decision in the matter so that construction of the highway can start at the earliest”. The proposal was moved before the last hearing on Monday. The note said work on six-laning of Panipat-Jalandhar highway was stopped by the concessionaire Soma-Isolux more than one-and-a-half years ago.”The concessionaire is not even carrying out the minimum required maintenance of the highway to keep it traffic worthy. The condition of the highway is very poor and at a number of locations, it is unsafe for traffic movement,” the note said.
However, the plan was dropped by the ministry at the last minute. Sources said Fernandes was keen to appear before the court since poor progress on this stretch was raised by several MPs from Haryana and Punjab.
The concessionaire has been fighting to shift toll plazas to plug revenue leak, which NHAI has claimed would maximize toll collection by the company. NHAI has been opposing the relocation of toll plazas citing public interest.
On Monday, the arguments got almost completed. Now both the developer and NHAI have been allowed to file their written submissions before November 29 when the court will take up the case again.
November 14, 2013
P Vasanth Kumar, TNN |
BANGALORE: The Karnataka high court has ordered notice to both Karnataka as well as the Union government and the national highways authority of india (NHAI) in response to a petition challenging the construction of elevated road connecting Bangalore International Airport (BIA) at Devanahalli, just outside Bangalore city.
Justice A S Bopanna has asked the respondents to file their objections to the petition filed byAgni Aerosports Limited, Jakkur. The petitioners, who are a running helicopter training school have claimed that they were forced to approach the court finally as their repeated requests/requisitions with the government against the said road project since 2010 have failed to yeiled any results.
The petitioners have complained that the area comes under ‘no construction zone’ and the construction of the elevated road has been undertaken without permission and the same would affect the helicopter training activities undertaken by them. Interestingly, the construction of the elevated road project is going on briskly and almost 75% work is said to be completed.
November 13, 2013
Chennai: With the contractor of the Chennai port-Maduravoyal elevated corridor project making a fresh claim of Rs 945 crore, National Highways Authority of India (NHAI) has written to the state government giving it a last ‘opportunity’ to reconsider its decision to stop the project failing which it would terminate the contract.“The NHAI board is of the tentative view that a last opportunity may be given to the state government for withdrawing the stoppage order failing which it will consider terminating the concessionaire agreement,” Satish Chandra, member (Finance) of NHAI said in a letter dated October 25 to Tamil Nadu chief secretary Sheela Balakrishnan.
The Rs 1,815-crore elevated corridor project was put on hold in March 2012 following a ‘stop work’ notice issued by the Water Resources Department alleging deviation in the alignment of the corridor along the banks of the Cooum from the originally approved alignment.
NHAI’s latest appeal to the state government came in the wake of the concessionaire, the Chennai Elevated Tollway Ltd (CETL), seeking compensation of Rs 945.16 crore for the losses suffered by it till September 30.
CETL team leader W. Prakasa Rao, in a recent letter to the general manager (technical), NHAI, New Delhi, sought payment of Rs 945 as compensation toward loss suffered by it within 30 days of receipt of his letter.
Sources in NHAI said that they would be forced to terminate the contract if the state government did not reverse its decision. “Holding the project for a long time will lead to payment of an hefty compensation to the contractor,” the official said.
The NHAI had also approached the Madras High Court seeking a direction to quash the order stopping the work and it also submitted an additional affidavit stating that the state government is bound to bear all financial expenditure on account of stoppage of the project.
October 31, 2013
Vaibhav Ganjapure, TNN
NAGPUR: Peeved by the inaction of National Highway Authority of India (NHAI) despite the ever worsening condition of the Mansar-Khawasa road, the Nagpur bench of Bombay high court on Tuesday issued an ultimatum to it to complete all repair works by February 2014.
TOI’s September 20 issue had reported in detail about the 40km stretch from Mansar to Khawasa on NH-7, where only potholes are left instead of road. Despite being a national highway, the potholes have turned into almost two-feet-deep ditches throughout the stretch. Of late, it had gained notoriety for accidents, long traffic snarls and damaged vehicles.
During the last hearing, a division bench comprising justice Bhushan Gavai and justice ZA Haq had asked NHAI what action it proposes against Oriental Nagpur Bye-Pass Construction Private Limited for failure to maintain the road. However, the court was informed by NHAI through an affidavit that Oriental’s contract ended on September 27 last year. The judges then asked chief general manager of NHAI to float new tenders and award contract to new bidder for repairing the road before November 15.
Ramtek MLA Ashish Jaiswal has also filed an intervention application in the suo motu petition where Nikhil Padhye was appointed amicus curiae.