Investors in Singapore have to be either terribly confused or terribly impressed. They’ve just been told by Surface Transport Minister Kamal Nath that he plans to increase five-fold the pace of construction of highways in the country, to 20 km a day. Mr Nath, who is currently on a trip to South-East Asia, plans to repeat his message in the US and Europe. To convince them, he has outlined some of his plans. These include setting up of 150 exclusive land acquisition wings, reducing the stranglehold that engineers have on the National Highways Authority of India — engineers typically over-specify projects, making them non-bankable. The minister gives the example of the Belgaum-Dharwad highway where paring of unnecessary service lanes and flyovers has reduced the cost by 40 per cent, from the original estimate of Rs 480 crore. An expressway authority has also been announced.
If Mr Nath is able to get NHAI to increase its performance levels five-fold, it will be a miracle. To achieve that, he needs to demonstrate what mechanism he has put in place to ensure that routine over-engineering is a thing of the past. A history of BOT (build-operate-transfer) projects shows that NHAI issues detailed specifications for even these projects. Yet, NHAI has not put in place a standard contract for road specifications. A reading of the contracts awarded by NHAI over the years shows that the organisation has been relatively slow to award BOT projects, possibly since the level of NHAI oversight is the lowest in such projects.
In short, the minister’s biggest challenge will be to get NHAI to change. There is a full report on how to go about doing this — ensure a minimum three-year tenure for the NHAI chief, set up of a separate PPP wing within NHAI, and so on. Getting the NHAI to prepare viable BOT projects — secure the land well in advance, get various state government bodies to shift utilities, get clearances to cut trees, and so on — is still a challenge. Mr Nath deserves the country’s support in what he seeks to do, because the task is not an easy one.
