Undeterred by the current global slowdown and also due to the hurdles during the land acquisition, the Centre expects an investment of (Rs 588,000 crore) $120 billion during 12th plan in roads and highways in the country. There is a huge potential for investment in this sector likely to create opportunities in the core construction industry which may also be attractive even for foreign players, said CP Joshi, minister of road transport and highways.
Speaking with Business Standard at the sidelines of global investors' conference here, Joshi said his ministry plans to undertake conversion of 20,000 km of single lane into double lane. "This time around we have fixed our targets at achieving 7,300 km for award of projects. Of this so far, 31 projects covering a length of about 4382 km with a total project cost of about Rs 39,152 crore have been awarded till January 31. We have decided to adopt a pro-active approach rather than a reactive approach to maintenance," the minister said.
Joshi informed that a number of steps have been initiated to enable faster and more inclusive growth of the transportation sector. "To sustain the acceleration in award process, annual pre-qualification of bidders has been introduced along with e-tendering and e-procurement of projects. NHAI is poised to achieve the target it has set for award of projects this year. We are actively considering development of an acceptable EPC (engineering procurement and construction) document which will promote cost effective and timely execution of projects. The focus will remain on implementation of projects on build operate transfer (BOT) on toll, BOT on EPC and BOT on annuity," the minister said.
Joshi said the response has been overwhelming. Each project has bid out both in terms of number of bidders as well as the competitiveness of bids. "As a matter of fact NHAI has received record premiums this year. Let me share that 21 of the 31 projects awarded till January in the current fiscal have fetched premium of about Rs 2174.89 crore. NHAI will continue to get this premium annually for next 20 years," he added.
Minister said the mobilisation of funds was not a problem and recalled that NHAI's recent tax free bond issue of Rs 10,000 crore was oversubscribed. NHAI has mobilised R 25,220 crore. "This success is due to the huge interest shown by Qualified Institutional Buyers (QIBs) and High Net worth Investors (HNI) in investing in NHAI. I am appealing to the investors to come forward in
future too," he noted.