Problems in land acquisition, removal of structures, shifting of utilities and law and order in some states are among the problems affecting the growth of the road sector, the pre-budget Economic Survey says.

Coming a day before the Union Budget 2007-08, the Survey tabled in Parliament on Tuesday said progress in road infrastructure will depend on removing law and order problems in some states and monitoring the performance of errant contractors.

"Constraints faced in the timely completion of the National Highway Development Project include delays in land acquisition, removal of structures and shifting of utilities," it pointed out.

The Survey said nearly 93 per cent of the work on the Golden Quadrilateral has been completed by November 2006 and the North-South and East-West corridors are expected to be completed by December 2009.

These projects are part of NHDP-I and II, envisaging the completion of 14,729 km of National Highways at an estimated expenditure of Rs 65,000 crore (Rs 650 billion).

The government has planned to give a facelift to all National Highways at an estimated cost of Rs 2,20,000 crore (Rs 2,200 billion).

"The drumbeats of infrastructure are gradually getting louder and in the next few years their rumble will be felt and heard all over the country," the Survey pointed out.

Without spelling out any specific funding mechanism for the road sector, the Survey suggested the outlook in the entire infrastructure sector will depend on how much investment is facilitated in it.

The Survey argued that while the substantial impact of the GQ was already visible, the government still needs to focus its attention on corridor management and road safety for

which the National Highways Authority of India has put in place a corridor management policy.

In order to facilitate investment in infrastructure, the government will have to ensure long-term funding with long pay back periods, for example from insurance and pension funds.

"Thus success on the infrastructure front will be facilitated by the development of a vibrant bond market and pension and insurance reforms. A single unified exchange-traded market for corporate bonds would help create a mature debt market for financing infrastructure," it said.

As part of NHDP-III, 4,035 km of highways will be upgraded at an estimated cost of Rs 22,207 crore (Rs 222.07 billion) while about 6,500 km of national highways will be widened to six-lanes at an estimated cost of Rs 41,201 crore (Rs 412.01 billion), it said.

Besides, the government has approved construction of 1,000 km of expressways with full access control on new alignments at a cost of Rs 16,680 crores (Rs 166.8 billion) under NHDP-VI.

The government funded NHDP-I and II mainly through cess on petrol and diesel. The government also borrowed 1,965 million dollars from the World Bank and $1,605 million from the Asian Development Bank, besides taking a loan from the Japan Bank of International Cooperation.

Economic Survey 2006-07: Complete Coverage