Print Friendly, PDF & Email

Sansad TV: Committee Report- Issues Relating to Roads Sector

sansad_tv

 

 

Structural issues to be tackled- We need to focus on three structural issues:

  • Physical infrastructure development, Raising human capital and  Revival of rural economy for a long-term growth of 7 to 8 per cent and attaining $5 trillion economy by 2024.

Infrastructure Development-

  • Spending on infrastructure will have multiplier effects in the overall economy including stimulating private investment, aggregate demand and jobs.
  • Construction sector was an important source of job creation during 2004-05 to 2011-12. This sector has to be revived in order to create growth and employment.
  • The government seems to be fast tracking public capex, encouraging public sector enterprises (PSEs) to invest more and trying to clear the pending bills for the corporate sector and MSMEs.
  • The Vijay Kelkar committee’s recommendation on PPPs would be useful. The private sector’s role is equally important.

Funding:  

  • The Committee observed that the National Highway Authority of India (NHAI) has a large amount of liabilities.
  • To reduce debt servicing costs of NHAI, the Committee recommended: (i) exploring funding from insurance companies and pensions funds, both Indian and foreign, and (ii) requesting the RBI to make the road infrastructure sector eligible for priority sector lending
  • Taking note of the stressed assets of banks in the road sector, the Committee also recommended mandating the National Infrastructure Investment Fund and the upcoming Development Finance Institution (announced in Budget session) to facilitate offloading long term infrastructure loans from banks.

Awarding contracts:   

  • The Committee noted that the current practice of awarding road projects to the lowest bidder may lead to unrealistic bidding.
  • To ensure quality of road construction in contracts, it recommended: (i) defining a lower limit below which bids may not be accepted, (ii) maintaining a central database to analyse the quality of work of the contractors, (iii) breaking down big projects into smaller chunks to attract smaller contractors, and (iv) modifying the procedure for awarding tenders after consulting the Central Vigilance Commission.

Review of project preparation: 

  • The Committee observed that reviewing the preparation of the Detailed Project Report(DPR) was necessary to ensure quality.
  • To identify and reduce potential delays, the Committee recommended: (i) consulting the area’s Member of Parliament, as well as the local population, (ii) enabling acquisition of additional land along the proposed route, based on long term traffic projections, (iii) prohibiting construction of parallel roads adjacent to the planned toll-road are not built, and (iv) fixing accountability of officials from the stage of drafting the project report till complete project execution.

Delays in completing projects: 

  • The Committee noted time overruns, and observed that land acquisition was one of the primary reasons for delay.
  • To address time overruns, the Committee recommended: (i) conducting time bound recruitment for the large number of vacancies in NHAI, especially at the senior level, (ii) making the upfront contributions for land acquisition by the state governments flexible, (iii) enabling state governments to share some of the land capture value with the previous owners.

Maintenance of roads: 

  • The Committee noted the inadequate allocation of funds for maintenance of National Highways.
  • It recommended: (i) using network survey vehicles and drones to regularly assess the quality of the highway network, (ii) allowing for dedicated underground utility corridors in upcoming projects to prevent patchwork

Road safety:   

  • The Committee noted that long term rectification measures have been carried out on less than 50% identified black spots.
  • To improve road safety, the Committee recommended: (i) testing for defects in quality of construction material, especially through third party audits, (ii) mandating submission of video recordings to certify road markings, and signage (ii) fixing time frames for NHAI and state government officials to rectify black spots

Assessment and Ranking: 

  • The Committee noted the weightage given to highway safety (35%) in their framework for assessing highways.
  • It recommended assigning scores to all projects, including the ones executed by the state government.