Poor market sentiment for slow pace in road project awarding

December 3, 2012

NEW DELHI: The government today said pace of awarding road projects is slow in the current fiscal due to a host of reasons, including poor market sentiment.

“The pace of award of projects is slow due to various constrains like poor market sentiments, shortage of equity of developers, lender’s pre-condition of 80 per cent possession of land…,” Minister of State for Road, Transport and Highways Sarvey Sathyanarayana said in a written reply to the Lok Sabha.

The exposure limit of banks for infrastructure projects reaching to its pinnacle and Supreme Court’s ban on quarrying of stones and pure earth, used in road construction, are also posing problems.

The Minister, however, said out of the 6,089 km National Highways targeted to be developed/improved during the current fiscal under NHDP (National Highways Development Project) and non-NHDP schemes, 2,493 km have been developed till September.

Sathyanarayana said 32 projects, aggregating 3,750 km, are proposed to be taken up with 100 per cent Government funding in various states on engineering, procurement and construction mode as these were not viable to be developed on Built Operate Transfer (BOT) mode.

In a separate reply, he said that of the proposed 32 projects, 10 with a total length of 1,010 km are in Rajasthan and six road projects measuring 765 are in Uttar Pradesh among others.

In another reply, Sathyanarayana said that a proposal amounting to Rs 156.79 crore was received for development of the existing four-lane carriageway to six-lane carriageway passing through Ghaziabad on NH-24.

“… the same was returned unapporved as the work was not included in the Annual Plan 2012-13,” he said.

source: http://articles.economictimes.indiatimes.com