The ministry of surface transport (MoST) has started drafting a Bill for the creation of a dedicated fund to meet the resource requirements of highway projects. Sources said the Bill would be presented when Parliament reconvenes in October.
Official sources said currently cess on petrol and diesel is credited into the public account of India and, consequently, drawals have to be sanctioned by the finance ministry.
The cess on petrol currently brings in about Rs 790 crore per year and diesel a little over Rs 4,000 crore each year. However, 50 per cent of the cess on diesel has to be be allocated for certain priority development projects. The actual availability to the National Highway Authority of India is, therefore, about Rs 2,500 crore. Consequently, the annual fund availability to NHAI from both the cess is expected to be a little over Rs 3,000 crore each year.
At present, funds from
the Public Account of India cannot not be utilised immediately
on a bullet expenditure basis and have to be staggered depending on the phase of project
development.
The finance ministry `s release of funds is also not based on the availability of funds and project requirements. As a result project development and implementation schedules tend to get delayed.
Accordingly, the ministry and NHAI had sought the creation of separate dedicated fund, outside either the Consolidated Fund of India and the Public Account. This was to ensure that funds were available for meeting the various stages of development in project, right from project preparation to project completion.
Sources also indicated that wherever such funds were not utilised, treasury management was required to ensure that the accretions earned an interest element through investments in highly liquid assets like 364-day treasury bills and government of India securities .
Investments in such securities would enable the fund to earn a minimum interest of about 11 to 12 per cent annually.
Enactm
