Centre, states to track project progress via joint mechanism

September 26, 2014

In a novel exercise, the Centre and states have decided to join force to set up a mechanism to fast-track stalled infrastructure projects. The proposed ‘joint mechanism’, to be headed by Cabinet secretary Ajit Seth and comprising chief secretaries of concerned states, aims at expediting the implementation of projects that have a cumulative investment potential of nearly Rs 10 lakh crore.

To fix the responsibility for delays in various projects, Prime Minister Narendra Modi has directed the formulation of a database on major contracting firms entrusted to supply equipment and raw materials for different projects and upload their details in the procurement portals of concerned Union ministries and state-run companies.

While electronic procurement is gradually becoming the norm in most government procurement, the concerned Union ministries should focus on making the suppliers accountable for untimely delivery, the Prime Minister has said.

The government has decided that the mechanism would also be web-based for online resolution of issues. Currently no known mechanism exists to coordinate execution of projects between the Centre and the states.

On fast tracking the ongoing projects, the government has intensified the monitoring of progress, as key projects such as roads, airports and electricity generation are way behind their annual targets.

The Planning Commission, which the Prime Minister wants to be dismantled, has cautioned that while much less money is being spent for giving facelift to infrastructure development, even the pace of execution of various projects is also tardy.

Seth had already told an industry delegation in December last year that about 255 projects are stalled entailing an investment of nearly Rs 10 lakh crore, but considering that the previous UPA government was on its last leg, not much headway could be made.

The bad loans of public sector banks led to their gross non performing assets increase by nearly four times from March 2010 (Rs 59,972 crore) to March 2014 (Rs 2,04,249 crore), according to the Economic Survey of the finance ministry.

In a presentation to Modi on September 10, the Plan panel cited that the Airports Authority of India (AAI) has invested only Rs 162 crore during the April-August period against a targeted expenditure of Rs 934 crore for 2014-15.

While the AAI is yet to declare airports in Bhopal, Indore and Raipur as international airports, it has still not identified four airports to be developed along with private partnership in the first five months of 2014-15. Portraying a dismal picture for the railways, the presentation said it only 450 km of new lines were constructed in 2013-14, but has managed to construct only 39 km out of a targeted 300 km during the first five months of 2014-15. It achieved only 36 km of gauge conversion and electrified only 97 kms.

In the roads sector, construction of 1,860 kms of roads awarded against targeted 8,500 kms and 178 km of highways tolled against targeted 3,730 km. In the electricity sector, the country added capacity of 8,318.47 MW during these months as against the targeted 17,830.30 MW. Coal output was 220.52 million tonne during the period against targeted 630.25 MT.

 

Source:The Indian Express

Govt’s plan of limiting toll collection faces resistance

September 26, 2014

Currently, the toll rates are typically brought down to 40% of the ongoing toll rate after the end of a concession period. Photo: Mint New Delhi: Roads minister Nitin Gadkari’s promise of limiting toll collection to recover project cost is facing resistance on grounds that it will add to the fiscal burden of the government. Officials in the road ministry and National Highways Authority of India (NHAI) have pitched to make a presentation to the minister to explain why the proposal is not feasible. “We have asked the minister to let us explain why stopping toll collection after recovering the project cost may not be desirable,” said an official who did not want to be identified. “Money collected through toll after the end of the concession period is used to maintain national highway projects.

Usually these are good stretches and cost of maintenance is high and there aren’t enough funds with the government to ensure maintenance of these stretches without the toll money,” he added. Currently, the toll rates are typically brought down to 40% of the ongoing toll rate after the end of a concession period. Concession period is the duration for which a developer is given the contract for tolling a road project for recovering the cost of construction and maintaining it, and typically ranges between 20 and 30 years. “The tolling policy is very vague. It needs to be revisited for many reasons like defining what constitutes the cost of construction and why some stretches are tolled and some not,” said a second official, who too requested anonymity.

“However, the toll that is collected after the concession period is used for maintaining and cross-subsiding other national highway stretches that cannot be tolled. If this is removed where will the money for maintaining the national highway network come from?” Gadkari first spoke of stopping the collection of toll once the cost of a project is recovered in the Lok Sabha on 14 August. Addressing a conference on 100 days of the National Democratic Alliance (NDA) government on 15 September, Gadkari reiterated his keenness to go ahead with the proposal. The remarks come in the backdrop of several instances of protests against toll collection.

Road ministry officials are exploring alternative, acceptable solutions for resource mobilization that could at least address the resentment of the local residents. “One of the suggestions is to toll only the commercial traffic after the cost of the project is recovered as anyway 80% of the toll collection comes from the commercial traffic. However, all this is at an initial stage,” the first official said. The National Highways Fee (Determination of Rates and Collection) Rules formulated in 2008 are in force currently.

“The tolling strategy needs to be relooked at, keeping in mind the issue of the local users. More importantly the issue of collecting toll until perpetuity for stretches without providing an alternative free route to users who may not wish to pay also needs to be addressed,” said Pranavant, senior director at Deloitte Touche Tohmatsu India Pvt. Ltd, an audit and consulting firm. He uses a single name. The move, when first suggested, had been criticized by the industry too on grounds that it could make it difficult for the developers to access bank finance.

Source:live mint

Vinayak Chatterjee: Can toll roads be made user-friendly?

September 26, 2014

Vinayak Chatterjee

The Rajasthan High Court, last Monday (September 1), stayed the hike in toll on the Jaipur-Delhi national highway till such time as the National Highways Authority of India (NHAI) and the operator file an affidavit confirming that the road is in good condition and that a proper and maintained highway exists that justifies the toll charged.

India has been obsessed historically with asset creation, not effective asset utilisation. Highway build-operate-transfer projects were largely seen as yet another construction project with immediate order-book gains for construction companies. Though the concession agreement specified operations, maintenance and tolling service delivery standards across the life of the project, no one paid much attention to them. Many concessionaires did not have the mindset or the experience to manage long-term assets of this kind, and the attitude was to generally get by NHAI inspections.

The ministry of road transport and highways is now keen to revive road construction activity with a slew of engineering, procurement, construction (EPC) contracts – totalling to almost 10,000 km in the here and now. Interestingly, it is understood that these EPC packages are getting bundled with five to 10 years of operation & maintenance (O&M) obligations too. This is an eminently sensible decision. With all this, thankfully, “asset management” is getting the required attention. Increasing road-asset acquisitions by long-term financial investors, pressure for maximising toll revenue, greater oversight from the judiciary, higher focus by NHAI and the ministry, and greater media and activist attention are also adding up. Many myths, hitherto used to justify poor O&M, seem to be getting exposed.

My friend and colleague Vivek Rastogi, who is a well-recognised expert in road operations and maintenance, has over the past few years been dissecting a few myths about highway operations and maintenance.

Myth one: Toll revenue is under pressure, so funds are short for operations and maintenance

Developers have been complaining about lower-than-anticipated traffic on their highways. This is indeed true in some specific cases where local and surrounding issues have lead to reduced movements. However, empirical data from different parts of the country reveal that the actual traffic over the last year, measured as passenger car units has increased by 2 to 12 per cent. This is also borne out by NHAI data. In addition, inflation-indexed toll rates have increased. Better tolling processes, wherever implemented, have boosted revenue, resulting in an overall 12 to 30 per cent increase in toll revenue in rupee terms. Therefore, toll revenue pressure is clearly not the overriding constraint particularly when one factors in that O&M expenses hardly ever exceed 3 to 5 per cent of toll collections. It is often a convenient excuse for complacency and lethargy among highway site-operations teams. Financially, the culprit is over-aggressive bids based on over-optimistic toll projections and under-estimated O&M costs that have not matched real life, thus leading to a “virtual” funds crunch.

Myth two: Lack of support from local administration

The experience on the ground is different, particularly in the bulk of the states where NHAI has the state support agreement in place. Barring sporadic incidents of politically-inspired attacks for media attention, most developers have received reasonable support from the police and district administration. The same holds for media, which has largely been publishing all sides of an “incident” story pretty fairly. This has helped get miscreants arrested at toll plazas. Traffic diversions for escaping tolls have been blocked by the district administration, and elected representatives in most cases, have been supportive of operations according to the concession agreement. Local problems will continue but it has now been seen that solutions can be found with regular and correct liaison with the district authorities.

Myth three: Route operations and route patrolling is an unnecessary spend

The purpose of route operations is to ensure that incidents and accidents on the highway get quick support and attention, and the traffic flows smoothly. Unfortunately, route operations and patrolling are often the first areas where operators try to cut costs with hugely deleterious effects on user satisfaction. It is a rare sight to see regular patrol cars, helpful signage and roadside amenities on Indian highways. Good route operation practices can save precious lives in highway accidents – an area of notoriety for India. This uncaring attitude is primarily based on the fact that road concessionaires still do not see themselves as “service deliverers”, where customer satisfaction and loyalty are necessary for survival as in the case of other businesses where customers have a choice. NHAI clearly needs far higher enforcement of standards in this area.

Myth four: Asset maintenance can be delayed

Roads typically have the following types of maintenance patterns: routine (preventive and reactive) and episodic (say, overlays in five years). In both the categories, the usual business practice is to delay matters till the road surface is either in a shambles or the spectre of penalties looms large. Sadly also, there is minimum use of technical advancements. The net result is a severe deterioration of the life-cycle quality of the asset as well as user-satisfaction. But the concessionaire believes he has “smartly” saved costs.

Myth five: Traffic tail-ending at toll plazas is inevitable

This need not be so. The ease with which cars zip through electronic toll barriers abroad clearly demonstrates the art of the possible. It is surprising that in India, we are not sufficiently agitated with the minutes we are required to wait before passing through a toll barrier. The slow pace of implementing cost-effective electronic tolling and dedicated electronic lanes is a testimony to our collective national lethargy on this aspect. Even without this, hand-held devices with roaming toll-collectors, aggressive marketing of on-board prepaid devices and systematic lane-management, could, if there is a will, actually seek to eliminate tail-ending at toll plazas.

Myth six: Continuing toll-collection during carriageway widening is appropriate

This is clearly addressed to NHAI and the ministry of road transport and highways. The existing model concession agreements, from their lofty perch, clearly did not see the practical problems of allowing toll-collection to continue when carriageway are being widened. It is clearly messy and has a high irritability quotient for all users. Further, it takes away from the spirit of a hassle-free drive questioning the rationale of the toll, and creates a strong negative perception which, as in the case of the Delhi-Jaipur highway, invites the wrath of the judiciary. This should be discontinued in future contracts.

There is clearly a growing need for a new generation of specialised outsourced “asset management partnerships” to manage the operative life-cycle of an asset properly and most importantly, deliver value to the customer. Myths will not do.

Source:Business Standard

Toll plaza vandalised after youth dies in hit-and-run

September 26, 2014

The damaged toll plaza on National Highway 50 in Koppal taluk after the violence on Thursday.

The damaged toll plaza on National Highway 50 in Koppal taluk after the violence on Thursday.

A toll plaza being operated by the GMR Group was vandalised and its staff beaten up by an irate mob on National Highway 50 four-lane road near Hitnal in Koppal taluk on Thursday after a youth was killed in a hit-and-run accident.

According to information reaching here, the youth, Suresh, who was heading towards Koppal on his bicycle, was run over by a heavy vehicle. He died on the spot.

As the news spread, people from Hosahalli and Hitnal started gathering near the accident spot. They started blaming the GMR company, which had taken up the road construction work, for not providing service road and also not laying humps, resulting in the death of the youth. They blocked the highway and burnt tyre to register their protest.

There was a heated argument between the people and the staff of the toll plaza over sharing of the CCTV footage and the mob damaged the windowpanes and also assaulted the staff. A vehicle belonging to National Highways Authority of India was also damaged in the incident.

According to sources, people are agitated over the location of the toll plaza as they have to cough up the fee every time they use the road. They also urged the authorities to shift the toll plaza, but the response was lukewarm. This was another reason for the attack on the toll plaza, according to sources.

The police, on learning about the incident, rushed to the spot and prevented the situation from going out of control. Superintendent of Police T.D. Pawar also visited the spot.

Source:The Hindu

Road users slam collection of toll on NH 210

September 11, 2014

Some major components of the NH work are yet to be over

Pay before you use:The overbridge at Letchumanapatty near Keeranur on NH 210 is still at its nascent stage, but the NHAI has granted permission to a private company to collect toll at two places.— Photo: A.Muralitharan

Pay before you use:The overbridge at Letchumanapatty near Keeranur on NH 210 is still at its nascent stage, but the NHAI has granted permission to a private company to collect toll at two places.— Photo: A.Muralitharan

Collection of toll on National Highway 210, which is yet to be fully completed, has drawn criticisms from road users.

Though the majority of works on the 81.05-km stretch between Mandaiyur near Tiruchi and Managiri in Sivaganga district have been completed, important components such as construction of overbridge at Kalamavur and bridges near Pudukottai are yet to be completed. Motorists are still using the old road at several points. In some places, the private company that undertakes the laying of extended two-lane is yet to put up signboards .

However, the National Highways Authority of India (NHAI) has given permission to the private company to collect toll at Letchumanapatty near Keeranur and Lembakudi near Karaikudi. For a single trip from Tiruchi to Karaikudi, buses and trucks have to shell out Rs.170. The fee for a car or van is Rs.50 (Rs.25 each at Letchumanpatty and Lembakudi).

Though motorists have no hesitation to pay the toll, the permission granted for collecting toll before fully completing the works anguishes many.

“We pay hefty sums for using the toll road. But motoring at several stretches is still painful. The NHAI shouldn’t have given permission to collect the toll before the full completion of works,” says M.Murugesan, a car driver.

“We couldn’t understand the rationale behind the decision.

If the NHAI wanted to help the investors, who built the road, it should have pressurised them to complete the works within the stipulated time or it should have played the role of facilitator to convince the line departments to complete remaining works on time,” said another road user.

When contacted, personnel at the toll plazas told The Hindu that the fee was being collected only for the completed portion. As per NHAI rules, fee can be collected if 75 per cent of the road works are completed. As far as the Tiruchi-Karaikudi road is concerned, about 80 per cent of the works have been completed, they said.

Source:The Hindu

Soon, pay toll on Inner Ring Road

September 9, 2014

Rs. 600-crore EMRIP stretch to be completed by November

Road work is in progress on Ennore Expressway, near Kasimedu —Photo: V. Ganesan

Road work is in progress on Ennore Expressway, near Kasimedu —Photo: V. Ganesan

In a few months’ time, motorists may have to pay toll to use the northern segment of Inner Ring Road, beyond Madhavaram.

A toll plaza is to come up on the road as part of the Ennore-Manali Road Improvement Project (EMRIP). The rates will be fixed after approval from the State government, said an official of National Highways Authority of India (NHAI).

EMRIP involves widening of four roads — Tiruvottiyur-Ponneri-Panchetti Road, Manali Oil Refinery Road, Ennore Expressway and Inner Ring Road — leading to Chennai Port and Ennore Port, and is expected to be completed by November.

The foundation stone for the Rs. 600-crore project was laid in January 2011 and it was initially expected to be completed by January 2013.

However, even now, three stretches on the road are yet to be finished.

“We are yet to get land in Cherian Nagar and Nalla Thanneer Odai Kuppam on Ennore Expressway, and another 600 metres inside Kasimedu fishing harbour. Around 1.1 km of road is yet to be laid. By November, the project will be completed, but for these stretches that have to be handed over by the State government and Port Trust,” said the official.

S.R. Raja, secretary, Trailer Owner’s Association, Tamil Nadu, said, even if the road works are completed, unless additional gates are available at Chennai Port, for entry and exit of import and export trailers, the roads will remain congested.

“There is enough space inside the port for parking of vehicles. But, hundreds of trailers are parked on the roads, every day, causing inconvenience to other motorists,” he said.

 

Source:The Hindu

Toll plaza at Vagaikulam to be ready in a month

July 30, 2014

Many expressed discontent over paying toll at existing location

Site of change:A view of the new toll plaza near Vagaikulam in Tuticorin district.— Photo: N. Rajesh

Site of change:A view of the new toll plaza near Vagaikulam in Tuticorin district.— Photo: N. Rajesh

A new toll plaza under construction at Vagaikulam on NH 7 A (Tuticorin-Palayamkottai Bypass Road) will be ready in a month, says NHAI Project Director.

After discontent started brewing among heavy vehicle users over paying toll at the existing plaza at Thattaparai junction on Palayamkottai Road, the toll plaza was being shifted to Vagaikulam.

The plaza comprising six toll collection counters with approaching lanes and other infrastructure facilities was being constructed at a cost of Rs.1.4 crore, K. Thangavel, Project Director, NHAI, Madurai, who is in-charge of Tirunelveli, told The Hindu on Tuesday.

He said bhoomi puja for the toll plaza was performed on May 1 and works started immediately. Since local truck operators and other vehicle drivers registered in Tuticorin were reluctant to pay the toll after demanding the shifting of the plaza beyond Vagaikulam airport approach road, the toll agency withdrew from collecting toll.

The toll plaza is a key component of the 47.2-kilometre port connectivity project, which commenced in May 2010 on NH 7A. The toll collection was resumed here from May 1 this year after a gap of 10 months.

The Project Director said the revised toll fee notifications were awaited. Communiqué on this special purpose vehicle project, a joint venture of V.O. Chidambaranar Port Trust, Tuticorin and the NHAI, had already been forwarded to the NHAI, New Delhi. Once the project was completed, the notification would be implemented at the new toll plaza.

The 47-km-long four-lane road project from the port to Palayamkottai commenced in May 2010. After completing the work, the project contractor collected toll initially in April 2013.

After a scuffle between road users and toll staff in June 2013, personnel deployed at the counters left their jobs fearing risk of assault.

A lorry owners’ association here claimed that around 400 locally registered lorry operators had been carrying essential goods, including water, vegetables and salt to 11 villages around the toll plaza. These heavy vehicles would have to go through this toll plaza at frequent intervals. So, the agency should exempt these local operators from paying the toll, they sought.

They also agreed to pay the toll once the plaza was shifted to Vagaikulam.

Subsequently, a few persons, including MDMK district secretary S. Joel from Tuticorin, filed writ petitions against toll collection and demanded the shifting of the toll plaza to a new location beyond Vagaikulam Airport.

The toll collection once again came to a halt since the case was pending. Based on the NHAI’s submission that the toll plaza would be shifted to Vagaikulam, Justices V. Ramasubramanian and V.M. Velumani of Madurai Bench of Madras High Court on April 7, 2014 disposed of the writ petitions filed by five persons.

The court directed the NHAI to shift the toll plaza within four months, Mr. Thangavel said.

 

Source:The Hindu

Two revenue models proposed for bypass from Kazhakuttam to Karode

July 29, 2014

The Hindu

Thiruvananthapuram:

Annuity mode or tolling has been mooted to attract bidders to develop the 43.62-km stretch of the National Highway 66 (NH 66) bypass from Kazhakuttam to Karode into a four-lane carriageway.

Annuity mode or tolling has been mooted to attract bidders to develop the 43.62-km stretch of the National Highway 66 (NH 66) bypass from Kazhakuttam to Karode into a four-lane carriageway.

The suggestions had been made as at least five companies had shown ‘lack of interest’ to the request for proposal (RFP) floated by the National Highways Authority of India (NHAI) to develop the 26-km stretch from Kazhakuttam to Mukkola initially.

Opposition to toll collection in the State, its non-feasibility, and delay in handing over land for the 17.62-km stretch of the road up to Karode on the Kerala-Tamil Nadu border had been cited as the main reasons for the withdrawal of the companies.

An official of a company who participated in the RFP told The Hindu that the provisions to provide a link from the NH 66 to the proposed Kazhakuttam-Karode bypass had also affected the take off of the project, dragging on for over four decades now.

‘Financial closure’ was perceived difficult as toll volume would be low. Not many multi-axle vehicles moved through the stretch, qualified bidders had informed the NHAI.

Mostly, small cars would take the road and only 30 to 40 per cent of the road capacity would be used once it became a four-lane carriageway, he said.

The Public-Private Partnership Appraisal Committee had given the nod to take up the first 26 km on a public-private partnership (PPP) mode, for Rs.577.95 crore. The total project cost would be Rs.1,170 crore.

The bidders had also sought a revision of the design in view of the 16 road crossings proposed. At Venpalavattom, Chakka, Enchakkal, and Thiruvallom, vehicular underpasses had been mooted.

They had also told the NHAI that banks would give ‘financial closure’ to annuity mode as banks strictly followed RBI lending guidelines.

Land had been acquired for a four-lane stretch and to the extent of 45 metres on the Kazhakuttam-Chakka-Eenchakkal-Kovalam stretch. Fixing the fair value for the land in the Chenkal and Karode Blocks had been the major hurdle in completing land acquisition, sources said.

Source:The Hindu

Disputed stretches make implementation of toll collection between Delhi-Mumbai difficult

July 15, 2014

MAMUNI DAS

 NEW DELHI,  

 The ongoing disputes over highway stretches, such as Kishangarh-Ahmedabad and Gurgaon-Jaipur, has made it “challenging” for the Highway Ministry and National Highways Authority of India (NHAI) to implement common electronic toll collection (ETC) system on the Delhi-Mumbai highway stretch.

The Ministry is trying to put in place an electronic toll collection system in the Delhi-Mumbai toll road by mid-August. This will ensure that with an electronic tag attached on vehicles, drivers can zoom across national highways with automatic, electronic toll payment without having to stop and pay cash at toll booths.

It will also allow people to use a common card to drive between Delhi and Mumbai by paying tolls on some 30-35 toll plazas located on the stretch. The electronic toll system is already operational on the Mumbai-Ahmedabad stretch.

The national highway between Kishangarh and Ahmedabad is a disputed stretch. The project was bagged by GMR for six-laning and the company had stated its intent to exit the project unless the Government extended some benefits. This stretch lies on the Delhi-Mumbai NH route.

For all seven toll plazas on Kishangarh-Ahmedabad stretch, NHAI is implementing the electronic toll collection on a public-funded basis. “Tecsidel, a Spanish firm is installing ETC systems on 20 public toll plazas of NHAI,” said a source in the know.

Explaining the preparedness of Delhi-Mumbai national highway for the project, an official said, “The Delhi-Gurgaon stretch has an ETC system based on older technology. It has been taken over by IDFC and the developer is installing the project now.”

Then, there is the Gurgaon-Jaipur expressway, being implemented jointly by KMC Constructions and ETA, which is disputed as the developer is short of funds and there are plans of NHAI stepping in to complete the project.

Finally, there is the Ahmedabad-Mumbai stretch, in which 10 out of 11 toll plazas are already connected on the ETC system.

About 15,506 km of highways were being tolled as of March 31, 2014. There are 374 toll plazas, of which 210 were public-funded roads.

 

(This article was published on July 14, 2014)

 

Govt mulls toll based on area travelled

July 10, 2014

Dipak Kumar Dash, TNN |

NEW DELHI: With the change of government, a major modification in the “tolling” norms on highways is likely. The road transport ministry is mulling a model where commuters are asked to pay toll for the stretch they actually travel rather than paying for the entire corridor between two toll plazas.This concept is called “closed tolling”; something that’s practiced on Yamuna Expressway.

At present, open tolling system is followed across the country. Under this system, a commuter has to pay for the entire distance between two toll plazas even when he travels only a few kilometers.

During a power-point presentation before road transport minister Nitin Gadkari on Monday, ministry officials said local commuters have protested paying toll for an entire stretch despite travelling only short distances. Sources said the minister asked officials to find a solution to this.

“Now we will start work to address this concern of many commuters. We are very much aware of our condition in comparison to what is prevalent in developed countries. The model of closed tolling can be followed in the case of new expressways and highways,” said a ministry official.

Government officials said the ministry will have to amend its toll rules so that toll plazas can be allowed at shorter distances. “We can address commuters’ concern of paying toll at shorter intervals, once we implement the single tag that can be used for paying toll across the plazas,” a source said.

On the menace of overloading of vehicles, the minister told officials that there should be higher fine for intentional overloading. The penalty can be less for overloading up to 10-15% where it’s unintentional, such as a tractor carrying farm produce.

Source-http://timesofindia.indiatimes.com/

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