When Nitin Gadkari took charge of Minister for Road Transport and Highways in Modi Sarkar, the ministry was in a complete mess, hundreds of road projects worth Crores of rupees were stuck due to Red tape & Land acquisition, different ministries worked like silos insuring that a simple environmental clearance took years to come or in some cases never came, projects were awarded without due clearances, the habit of declaring State highways into National highways was also prevalent. A number of policy initiatives was taken up by Nitin Gadkari to fix the problem: –
- Exit Policy – This is aimed at improving the availability of equity in the market. The Exit Policy framework permits concessionaires/developers to divest 100 percent equity and exit all operational BOT projects two years after completion of construction. This would help unlock equity from completed projects making it potentially available for investment into new infrastructure projects across the country.
- Fund Infusion to Salvage Languishing Projects – This initiative authorizes the National Highways Authority of India (NHAI) to intervene in projects that are in the advanced stage of completion but are stuck due to lack of funds. NHAI has been authorized to provide funds to such projects from within its overall budget/corpus on a loan basis at a pre-determined rate of return. This loan is to be recovered along with interest as the first charge from the toll receipts immediately after completion of construction. Out of a total of 73 languishing projects, issues have been resolved for 19. Contracts for another 39 projects have been terminated and the same are being restructured and rebid as of January 2016.
- Rationalized compensation to concessionaires for languishing NH projects in BOT mode for delays not attributable to concessionaires – the Cabinet has approved the same which would add to the comfort level of prospective project concessionaires.
- Segregation of Civil Construction cost from Capital Cost of National Highways projects for appraisal and approval – The Government has approved segregation of construction cost from cost for land acquisition and pre-construction activities for the purpose of appraisal and approval of National Highways projects for the following dispensation. This measures will help cut down delays in the process of appraisal and approval of NH projects.
- Hybrid Annuity Mode of Delivery – A new mode of delivery under Public-Private Partnership (PPP) mode, namely Hybrid Annuity Model, is being promoted for awarding road projects for implementation under which 40% of project cost is being provided by the Government to the concessionaire. Remaining 60% is to be arranged in form of debt and equity to be compensated over 15 years as bi-annual annuities. There is separate provision for O&M payments by the Government to the concessionaire. The private party does not have to bear the traffic risk. All the payments have been inflation indexed by a Price Multiple Index which is a weighted average of WPI and CPI (IW) on 70:30 bases. This mitigates the inflation risk for the developer.
- NHAI Issues Tax Free Infrastructure Bonds – National Highways Authority of India is raising funds through public issue of tax free, secured, redeemable non-convertible bonds with Face Value of Rs 1,000 each for an amount of Rs. 1,000 crore with an option to retain over subscription of upto additional Rs. 9,000 crore, aggregating up to a total of Rs. 10,000 crore.
- Closer Coordination between different ministries – The Silo system that was in place during the UPA rule has been completely demolished by the Modi led PMO, the effects of this is evident, files which took years to clear are now being cleared in days, this has resulted in significantly faster decision making.
The results for the spirited leadership of Nitin Gadkari are significant in recent months Road ministry has been able to roll out 200 stuck projects worth 3 lakh crore, for the projects which require Special attention and project wise decisions a special empowered committee is being formed to roll out the Rs 30,000 crore worth of projects that have been stuck for quite some time.
The issue of declining private investment in road construction, due to the previous policy paralysis, has also been addressed, Private investment in road development projects is witnessing an uptick, the government awarded highway development projects for 750 km on build, operate, transfer (BOT-Toll) basis in the first two months of FY16. This is in sharp contrast to the 700 km of road projects awarded on this mode in the entire duration of FY15. Quoting the CMD of Srei Infrastructure Hemant Kanoria , “The government has shown all intentions to see things moving. In fact, the projects that were stuck because of clearances for few years now, are getting sorted and several of them have been cleared.”
Apart from cleaning the previous mess in the Road Ministry, the road ministry under the leadership of Nitin Gadkari has taken a number of initiatives to make Kick Start Road building in India: –
- The Rashtriya Rajmarg Zila Sanjoyokta Pariyojna – Under the Rashtriya Rajmarg Zila Sanjoyokta Pariyojna, roads will be developed to connect 100 district headquarters across the country. The scheme entails development of 6,600 km of highways at an estimated cost of about Rs 60,000 crore.
- Bharat Mala – The Rs 2.6-lakh crore Bharat Mala project that envisages construction of 25,000 km of roads along India’s borders, coastal areas, ports, religious and tourist places as well as over 100 district headquarters. The project will help connect remote regions in North and North East India to mainland India.
- Setu Bharatam – Under the “Setu Bharatam” scheme the road transport and highways ministry has set the target to build 210 ROBs (rail over bridge) in the next two years and about 400-500 bridges would be built as standalone projects. Further construction and expansion of the existing bridges would be taken up after carrying out the necessary paper work.
- Char Dham – Rs 11,000 crore has been allocated to ensure smooth and easy accessibility to the revered shrines of Badrinath, Kedarnath, Gangotri and Yamunotri in the Garhwal Himalayas.
- Expressway development – The Government of India has approved a plan for constructing 1000 km of Expressways under NHDP Phase-VI at a cost of Rs. 16,680 Cr.Vadodara-Mumbai Corridor (400 km),Delhi-Meerut (66km) on NH-58,Bangalore-Chennai (334 km) on NH-4,Delhi-Jaipur (261 km) on NH-8,Delhi-Chandigarh (249 km) on NH-1 and NH-22,Kolkata-Dhanbad (277 km) on NH-2 and Delhi-Agra (200 km) on NH-2.In addition to above, Government has approved to take up Eastern Peripheral Expressway-135 km, which is not a part of NHDP Phase VI.
As part of Government’s E-Governance initiative citizens can now track the pace of Road building in India using the online platform Epace.nic.in.
Nitin Gadkari has rolled out the Green Highways (Plantation, Transplantation, Beautification and Maintenance) Policy – 2015, to encourage green Highways which contribute to the green cover & help realize the vision of a clean and green India. At least Rs 5,000 crore will be spent on providing green cover to the country’s National Highways network in the next five years under the Green Highways Policy. Under this policy, the government has made it mandatory to set aside one per cent of the total project cost of any highways contract to a ” Green Fund ” corpus for plantation of trees along Highways. Help of Local community, farmers, NGOs, private sector, government agencies, self-help groups (SHGs) and the Forest Department will be sought to make the project a success. The Indian Space Research Organisation (ISRO) and Airports Authority of India’s GPS Aided Geo Augmented Navigation-GAGAN and BHUVAN would be used to map the progress on Plantation. The government plans greening of about 6,000 km of roads in the first year of the policy. Such an Initiative would help increase the forest cover of the country.
In regards to the areas of Road safety this government has taken 3 major steps.
- First is to conduct a ‘Road safety audit’ of 3,000 Kms of highways in 2016. Road Safety Audit involves evaluating highway improvement scheme during design, at the end of construction and post construction, to identify road safety problems and to suggest measures to eliminate or mitigate any concerns.
- The proposed Road Transport and Safety Bill, 2015, proposes an integrated approach to road safety & road transport.
- Rating the national highways on 20 parameters, the road transport and highways ministry is preparing about 20 parameters for objective assessment of NHs from time to time. They include, commuters’ comfort, safety, aesthetics and other facilities for pedestrians. These will work as guidelines for both the commuters and the government, sources said. This massive exercise is being undertaken for objective assessment of highways to identify the worst stretches that need immediate attention of government.
Nitin Gadkari is a man on a mission. He has enthused the dormant Transport ministry with his skilled and spirited chieftainship. Suresh Prabhu is now the darling of Twitterati for his Super Hero antics, Piyush Goyal’s LED story has been appreciated by one and all, but the super-leader feats of Nitin Gadkari remain concealed from the public eyes. Nitin Gadkari has taken the pet and the most favourite project of last NDA Prime Minister Shri Atal Bihari Vajpayee and the numbers above testify that he has been doing his work with utmost sincerity.
We wish Shri Nitin Gadkari, all the very best.
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