Land crunch, Green nod weigh down NHDP

December 15, 2007

NEW DELHI: The UPA government’s flagship programme, the National Highways Development Project (NHDP), has been delayed due to various reasons, including the government’s inability to acquire land. While no contracts have been awarded so far under phase-V, a few stretches under NHDP-III have been offered to developers.

The government offered contracts for only 278 km of highways up to October 2007 against the target of awarding 3,278 km under NHDP-III in 2007-08. Even for NHDP-II projects, consultants could not be appointed.

The government is, however, taking steps to bring all NHDP projects on track, an official said. The department of road transport and highways (DoRTH) has prepared a manual for four- and six-laning of highways and it would be finalised soon in consultation with the Planning Commission, he said. He attributed the delays in highway projects to slow progress in land acquisition and hurdles in getting environment clearances.

The department has identified 5,000 km of additional stretches to be upgraded on BOT basis under NHDP. The department would soon send the upgradation proposal to the Cabinet committee on economic affairs (CCEA) for approval.

DoRTH would also put 5,370 km more under NHDP-III and 1,760 km under NHDP-V for the approval of the public private partnership appraisal committee (PPPAC) by the end of the fiscal. On the proposed expressway between Noida and Ballia, the department would send its comments to the Planning Commission by the end of this month.

The government had earlier launched initiatives to upgrade and strengthen the national highways under various phases of NHDP. Over the next 4-5 years, these projects are estimated to cost around $40 billion.

Meanwhile, the government is setting up the directorate of road safety and traffic regulation. “Based on the recommendations of the Sundar committee, we would send the policy to the Cabinet for its approval. It should be finalised before the forthcoming Budget,” road transport and highways secretary Brahma Dutt said last week.

Written by ITW Editor · Filed Under BOT, NHAI, NHDP

MP promises solution to highway issue

December 12, 2007

Ongole, December 12: Magunta Sreenivasulu Reddy, MP, has assured people that he will prevail upon the National Highways Authority of India (NHAI) officials to lay the second bypass road away from town limits as part of widening the highway from the present four lanes to six lanes between Tada and Vijayawada.

Addressing a meeting got up by the Second Bypass Road Committee here on Tuesday, Mr. Sreenivasulu Reddy also promised to lead a delegation to the Union Minister of State for Surface Transport and also Prime Minister to achieve the demand. The MP said he had already taken up the issue with the Minister who responded favourably and issued directions not to widen the existing bypass road to six lanes in the town limits. So the officials concerned were not making any attempt to acquire the land for the purpose, he said.

But, as it would take some time to lay the second bypass road, heavy vehicles would continue to ply on the existing four-lane highway in the town limits, he said.
Traffic increases

Mr. Sreenivasulu Reddy pointed out that the Central government had agreed to widen the Chennai-Kolkata NH 5 from four lanes to six lanes in the stretch between Tada and Vijayawada to meet the needs of the increased traffic density.

The decision, however, caused agitation among people of Ongole and Chilakaluripet where the highway is passing through thickly-populated areas causing traffic and pollution problems. People began agitating for the second bypass road in these two towns and their concerns have been taken to the notice of the Government.

Committee president B. Ramagopala Reddy, who presided, said that people had opposed laying of the four-lane highway in 2002 itself. But, the NHAI officials ignored their objections and widened the road after giving an assurance to the High Court that the highway would be shifted while expanding it to six lanes.

The highway has virtually divided the town into two parts making it difficult for people to shuttle.

Ongole MLA, Balineni Sreenivasa Reddy, MLA, said that the Government wasted nearly Rs. 20 crores for constructing a flyover on the bypass road near Kurnool road. It should at least consider the opposition from people and shift the bypass away from town limits while widening it to six lanes.

Senior advocate and freedom fighter Karavadi Venkateswarlu stressed the immediate need to lay second bypass road as part of the expansion programme.

Source: siasat.com

Written by ITW Editor · Filed Under BOT, Expressway, NHAI, NHDP

3 major roads in first phase

December 12, 2007

BHUBANESWAR: Three major roads will be taken up for development in the first year of the phase-1 programme under Orissa State Road Project (OSRP) with World Bank assistance.

The World Bank has agreed to provide funds for improvement of road infrastructure of about 1,400 km with an estimated cost of Rs 1,480 crore.

While the loan component is Rs 1,175 crore, matching fund from the State will be Rs 305 crore. The project will be implemented in five years.

In the first year, 204-km stretch of road will be taken up for improvement. The three road projects which will be developed include the 99-km Chandbali- Bhadrak-Anandpur road, 70-km stretch of Khariar-Bhawanipatna road and 41-km road from Berhampur to Taptapani.

The State has identified five major roads having a length of 835 km for development in the first phase. Detailed project report (DPR) and economic viability and feasibility study of the projects have been completed.

The 152-km road stretch of Jagatpur-Kendrapara- Chandbali-Bhadrak, 138-km Bhadrak-Anandpur- Karanjia-Tongabilla, 213-km Khariar-Bhawanipatna- Muniguda-Rayagada-Kereda, 202-km stretch Berhampur-JK Puri- Rayagada and 127-km Banarpal-Daspalla- Bhanjanagar-Aska road have been finalised for the first phase.

Reviewing the road projects at a high-level meeting here on Tuesday, Chief Secretary Ajit Kumar Tripathy asked the Revenue Department to issue instructions to the district collectors concerned for initiating measures for land acquisition.

The 204-km road stretch, that will be developed in the first year, is passing through 160 villages.

Since land acquisition is a timetaking process, the Chief Secretary said the district collectors concerned must ensure that the land owners are properly compensated and the projects are completed in time.

The Revenue Department informed the meeting that notification had been issued to the district collectors for land acquisition. Works Department, the nodal agency for the State Road Project, has planned to develop 294 km of roads in the second year.

The Department will submit the first three road projects to the World Bank for approval and sanction of loan, official sources said.

Source: newindpress.com

Written by ITW Editor · Filed Under BOT, Construction, Expressway, Infrastructure, Investment and Finance, NHAI, NHDP, Projects

KAMAL NATH STRESSES ON IMPROVING ROAD CONNECTIVITY IN DMIC PROJECT

December 12, 2007

Shri Kamal Nath, Union Minister of Commerce and Industry, has called for improving the road connectivity of the four hubs / regions proposed to be developed in the Delhi-Mumbai Industrial Corridor (DMIC) Project. In his communication to the Chief Minister of Madhya Pradesh on 10th December 2007, Shri Kamal Nath has requested for initiating / undertaking the following action for improving the road connectivity of the four industrial regions (Pithampur-Dhar-Mhow; Neemuch-Nayagaon; Shajapur-Dewas and Ratlan-Nagda) under the DMIC Project:

i) The State Highway (SH-31) between Nagda (on National Highway-79) and Gujri (on National Highway-3) be four laned for providing the Pithampur-Dhar-Mhow Mega Industrial Region better connectivity with NH-79 and NH-59.

ii) Widening and strengthening of the Dewas-Ujjain-Badnawar stretch of State Highway (SH-18) to improve the connectivity of the Shajapur-Dewas Industrial Region to ensure improved linkage between National Highway-3 and National Highway-79, passing through Ratlam.

iii) Strengthening of State Highway-41 between Sarangapur-Akodia-Shujalpur-Ashta-Kannod for improving the road connectivity between National Highway-86 and National Highway-59A for serving both the Shajapur-Dewas Industrial Region as well as the Indore-Pithampur-Mhow belt.

iv) For converting the Jhabua-Thandla Road-Ratlam Road into a four laned State Highway to help the growth of the Ratlam-Nagda Mega Industrial Region.

v) To facilitate the growth of the Ratlam-Nagda region, Ratlam-Sailana road link for improvement/augmentation; and

vi) Jaora-Sailana-Banswara (Rajasthan) road be converted into a two / four lane State Highway.

Besides the above six road links, Shri Kamal Nath has suggested for improving the connectivity of Indore with Mumbai, the financial capital of the country. “I suggest that between Indore and Nashik, the road link be similarly converted into an expressway with the Government of Madhya Pradesh taking the responsibility of developing it between Indore and Shirpur on the Maharashtra-Madhya Pradesh border and for the remaining portion upto Nashik being so developed”, the letter says.

As regards National Highways, Shri Kamal Nath has written to the Minister for Shipping, Transport and Highways, Shri T.R. Baalu, explaining that the government has already accorded its in-principle approval to the development of the DMIC project, which passes through six states including Madhya Pradesh. Shri Kamal Nath has urged Shri Baalu to improve the transport connectivity in the above four industrial regions of Madhya Pradesh by four laning the Dewas-Sehore-Bhopal stretch of NH 86 extension and the road connecting Jaora on NH 79 with Maksi and passing through Mehidpur on SH 27 and Tararia being converted into an extension of the NH network.

Written by ITW Editor · Filed Under BOT, NHAI, NHDP, Projects

Omaxe, GVK & NCCL applies for projects worth Rs 300 bn

December 8, 2007

Omaxe, through a consortium comprising of GVK Power & Infrastructure and Nagarjuna Construction (NCCL), submitted an application with department of infrastructure development, government of Uttar Pradesh in regard to development of 8-lane access controlled expressway project from Greater Noida to Ghazipur Ballia (Contract Package nos. 1,2,3,& 4) to be executed as BOT (Toll) project on DBFO Pattern under `Ganga Expressway Project` in the state of Uttar Pradesh.

Brief details of the Ganga Expressway Project:

The 8-lane access controlled expressway would involve an estimated total construction cost of the order of Rs 300 billion and will cover a total of 1,047 kilometers. The project is proposed to be executed in special purpose vehicle (SPV) on design, build, finance and operate model by collection of toll in the concession period which is of 35 years and then transfer assets to government of state of Uttar Pradesh.

The construction of the project has been divided into four phases:

Greater Noida to Fatehgarh (Link-I) of total 253 kms with an indicative value of contract of Rs 76.31 billion.
Fatehgarh to Dalmau (Link-2) of total 305 kms with an indicative value of contract of Rs 80.12 billion.
Dalmau to Aurai (Link-3) of total 211 kms with an indicative value of contract of Rs 61.24 billion.
Aurai to Ballia of total 278 kms with an indicative value of contract of Rs 80.25 billion.

Shares of the company gained Rs 52.4, or 12.2%, to settle at Rs 482.05. The total volume of shares traded was 1,636,713 at the BSE. (Thursday)

Source: myiris.com

Written by ITW Editor · Filed Under BOT, Construction, Infrastructure, Investment and Finance, NHAI, NHDP

CRISIL assigned IPO Grade 3/5 to KNR Constructions

December 6, 2007

Leading credit rating agency, CRISIL assigned IPO Grade 3/5 (pronounced `three on five`) to the proposed initial public offer of KNR Constructions (KNRCL). The public issue of 7,874,570 equity shares of face value Rs 10 targeting an issue size in the range of Rs 1,500-Rs 1,750 million. This grade indicates that the fundamentals of the issue are average, in relation to other listed equity securities in India.

The grading reflects KNRCL`s strong track record of project execution in both roads construction and operations and maintenance (O&M). The company has executed many projects as part of the NHAI`s NHDP program and has had a 7-year relationship with Patel Engineering as a joint venture partner.

The KNR-Patel JV has won 10 road construction projects so far. These include two BOT annuity projects as a part of NHDP Phase II, the combined value of which is Rs 9.6 billion. As of September 2007, KNRCL`s order book stood at Rs 16.25 billion, of which the roads sector constituted 89%.

The grading is however constrained by the relatively underdeveloped state of the company`s operating system, which in turn, could constrain its ability to augment the size of its operations. The grading also reflects the uncertainties associated with company`s plans to diversify into the power generation and real estate sectors.

Source: myiris.com

Written by ITW Editor · Filed Under BOT, Construction, Default, Infrastructure, Investment and Finance, IPO, NHDP, Projects

Govt approves Rs 16,680-cr NHDP Phase VII

December 6, 2007

NEW DELHI: The government on Thursday approved development of road projects including construction of ring roads, bypasses and tunnels under Phase VII of National Highways Development Programme at a cost of Rs 16,680 crore.

“The Cabinet Comittee on Economic Affairs (CCEA) today gave its approval for construction of ring roads, bypasses, graded intersections, flyovers, elevated roads, tunnels, road over-bridges, underpasses and service roads at a cost of Rs 16,680 core,” an official spokesperson said after the CECA meeting.

The total project would be executed on build, operate and transfer (BOT) basis.

Of the total money, the government would fund Rs 6,302 crore and Rs 10,378 crore would be ensured through private sector participation, she said.

Under NHDP-VII, Rs 10,500 crore will be spent on constructions for 700 km of ring roads and bypasses and the remaining money would be utilised to construct grade separated intersections, road over-bridges, elevated roads, tunnels, underpasses and service roads, the spokesperson said.

These constructions will improve traffic safety and ensure faster movement of vehicles with improved riding quality time.

“This will lead to reduction in vehicle operating cost and significant reduction in fuel consumption for the vehicles resulting in energy conservation,” she said.

The works on stand-alone ring roads and bypasses are likely to be awarded by March 2011 and is to be completed by December 2014.

Source: economictimes.indiatimes.com

Written by ITW Editor · Filed Under BOT, Construction, Expressway, Highway, Infrastructure, Investment and Finance, NHAI, NHDP, Projects

CONSTRUCTION OF STAND ALONE RING ROADS, BYPASSES, GRADE SEPARATORS, FLYOVER, ELEVATED ROADS, TUNNELS ETC. UNDER NATIONAL HIGHWAYS DEVELOPMENT PROJECT PHASE VII

December 6, 2007

The Cabinet Committee on Economic Affairs today gave its approval for Construction of Ring Roads/Bypasses (including improvement of NH links in city), Grade Separated Intersections, Flyovers, Elevated roads, tunnels, Road Over Bridges, Underpasses and Service Roads at a cost of Rs.16,680 crore (Rs. 6,302 crore from Government + Rs.10,378 crore from Private Sector), on BOT (Toll) basis. Out of Rs.16,680 crore of NHDP Phase – VII, Rs.10,500 crore will be spent on constructions for 700 km of ring roads and bypasses. The remaining amount of Rs.6,180 crore on stand alone Grade Separated Intersections, Road Over Bridges, Elevated Roads, Tunnel, Underpasses and Service Roads.

Construction of ring roads, bypasses, grade separators, flyovers, Elevated roads, tunnels, Road Over Bridges, Underpasses, service roads, etc. will improve traffic safety and improve faster movement of vehicles with improved riding quality and time. This will lead to reduction in vehicle operating cost and significant reduction in fuel consumption for the vehicles resulting in energy conservation.

The works of stand alone ring roads & bypasses are likely to be awarded by March, 2011 and is likely to be completed by December, 2014.

Written by ITW Editor · Filed Under BOT, Construction, Expressway, Highway, Infrastructure, Investment and Finance, NHAI, NHDP

Toll policy change may rationalize annual hikes

December 4, 2007

Under the proposed policy, only 40% of the WPI will be taken into account while revising the rates

New Delhi: Even as tolled roads are becoming a norm in the country with the government handing over more highway projects to the private sector, a new tolling policy is seeking to limit the annual increase in toll rates.

As of now, toll rates are revised every year and concessionaires are compensated in full as per the increase in the wholesale price index (WPI). But under the new policy, which is yet to be placed before the cabinet for approval, only 40% of WPI will be taken into account while revising the toll rate. This is apart from a fixed component of a 3% increase every year.

As many as 54 highway construction packages of around 320 projects awarded under the National Highway Development Programme were “build operate and toll” projects. According to Planning Commission member Anwar-ul-Hoda, the idea behind changing the structure of toll revision was to ensure that the concessionaires are paid only their due share while fixing annual hikes on toll.

“The input costs of the concessionaire mostly occur many years before they begin to collect toll. So why should the toll revision be based on the wholesale price index of the current year?” asks ul-Hoda.

An official with the National Highways Authority of India (NHAI) also said that many components of WPI did not directly affect the highway construction industry.

The CEO of the roads division of the GMR Group, Rajan Krishnan, said his company was neutral to the proposal as WPI was difficult to predict. “Even the best economists cannot clearly track the movement of WPI. This is just a matter of mathematical modelling,” said Krishnan.

According to Krishnan, however, concessionaires stood to gain from the new policy so long as WPI was less than 5%. But when WPI moves beyond 5%, the toll rate to be charged under the new proposal would be lower than what is currently collected, he added.

Nirmaljit Singh, member, technical, NHAI, said the proposal was with the ministry of road transport and highways, from where it would be sent to the cabinet for clearance.

“I just think you are increasingly reaching a situation where the risk-reward equation is being changed against the government,” said an analyst with a consulting firm, who did not wish to be identified. “The government is taking more and more of the risk. You don’t need to guarantee a 3% increase every year when concessionaires had already accepted the earlier policy (where fee revisions were tied only to WPI),” the analyst said.

According to accepted wisdom, the government passes on fewer risks—such as those associated with traffic—to the concessionaire when evolving a public-private partnership policy and as the market evolves, passes on more of the risks. However, this administration is doing the opposite, the analyst said.

The analyst cited the example of the recent move away from “negative grants”, a term for upfront money paid to the government for the privilege of winning a concession, over and above the cost of the project. Mint had earlier reported plans to do away with negative grants in favour of a revenue-share model, where NHAI would derive a percentage of revenues from toll roads. “By going for revenue sharing, the government is taking more risks,” the analyst said.

Source: livemint.com

Written by ITW Editor · Filed Under BOT, Construction, Expressway, Highway, Infrastructure, Investment and Finance, NHAI, NHDP, Sensex, Toll Management System, Tolling

Nine road projects cleared by PPP appraisal committee

November 1, 2006

NEW DELHI, NOV 1: Road sector projects seem to be on the fast track with the public private partnership appraisal committee (PPP-AC) clearing nine road projects in its second meeting on Wednesday.

Written by ITW Editor · Filed Under NHAI, NHDP, Projects

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