Hit by delays, Nath's road target to be scaled down

The much-hyped target set by Union road transport and highways Minister Kamal Nath, to build 20 kilometres of roads every day, might be revised to a more achievable target, informed sources say.

Sources close to the development say there is talk within the ministry of a more feasible target. "The target of 20 kilometres per day is not sacrosanct. That is what the minister wanted to achieve.

It has been two years and we are nowhere close to that. Around 10-15 kilometres is more reasonable," said a source. At present, the country is building around six kilometers of roads per day.

Some industry experts, however, say the earlier target could be achieved if delays in project awarding and clearances are curtailed. "After project reports and feasibility are done, the entire process is like a cookie cutter," said K Ramachand, CEO, IL&FS Transportation Networks.

At present, as many as 60 road projects by the National Highways Authority of India (NHAI) worth around Rs 40,000 crore are stuck in clearances with the Planning Commission.

The first round of bidding for these projects, i.e, the pre-qualification round is already done, and they await financial bids. The commission raised concerns for procurement clauses, the size of these projects and viability gap funding to be provided to these projects.

Bids from as many as 30-40 companies, most of whom might have bid for multiple projects, are now awaiting progress from these projects.

"We have submitted the request for qualification for projects size aggregating to Rs 26,500 crore. Financial bids for these projects are expected in the next six months," said Virendra D Mhaiskar, chairman and managing director of IRB.

Maganti Ankineedu, director, Soma Enterprises, who has applied for pre-qualification for most of these projects, said there had been bunching of projects since the last one and a half years.

"While it has not been very consistent, there are so many projects that it is not a big issue. But if these delays continue for a year, it will have an effect," he said.

Experts say bidding from companies would be more rational if a certain number of projects seek bids at regular intervals.

"Like say, if every months, NHAI comes out with five projects, companies will have more time to prepare for bidding and there would be more serious bidding. If 60 projects come at once, they can't respond to all of them. They will pick and choose and there might not be enough competition," said Vishwas Udgirkar, senior director and partner, Deloitte.