Tales of Delayed Projects

The third week of August (12-18, 2012), saw a number of reports on project delays. The reasons cited for missing the deadlines were faulty planning, opposition from locals, non availability of equipment in time, liquidity crunch, etc.

It is now certain that India will not be able to meet the targeted addition of 1000 MW in the Solar power segment by May 2013. Though the government has managed to find private players to set up the targeted projects, the power developers are finding it difficult in executing those projects because of two main reasons – lack of enough ground stations to measure solar radiation and shortage of Heat Transfer Fluid (HTF) as there are only two suppliers of HTF globally.

It is also certain that the ambitious plans of the Union Ministry of Roadways and Transport to build 1,000 km of expressway at a cost of Rs 16,680 crore under Phase IV of the NHDP will not see making much head-way in the 12^th Plan either. The Ministry intended to set up the expressways in the 11^th Plan. The poor response NHAI is getting for its highway projects has made the ministry to go slow on its expressway projects. Despite all out efforts, NHAI has not managed to reach its goal of building 20 km of highways a day.

Paradeep Refinery has stated that its 15 million tonne refinery will miss the deadline of September 2012 at least by one year. Failure of BHEL to set up its captive power plant in time, non receipt of environment clearances for its jetty and delay in construction of pipelines and coastal roads because of land issues and opposition from locals has forced the company to revise the completion date of its Rs 30,000 crore project to September 2013.

Change in Tax rules and liquidity crunch has forced GVK Power to put two of its mega projects on the back-burner. The company has decided not to set up the proposed SEZ project in Tamil Nadu as the projex proposal has become unviable as SEZs now have to pay Minimum Alternate Tax (MAT). The company has also deferred its proposed Rs 7,000 crore greenfield seaport project at Okhamade in Gujarat. The company has failed to reduce its debt burden estimated at Rs 13,000 crore.

India - Population: 1.22 billion, 83 athletes & 6 Medals

The 2012 Summer Olympics, London, came to an end on 12 August 2012. Indian Olympic Association sent 83 athletes to participate in 13 different sports segments. Given the success we had tasted in the Beijing Olympics and in the recently held Commonwealth games, the expectations from Indian participants were very high. However, we ended with only six medal haul.

While the Indian Hockey team, the Tennis team, Vijender Singh (Boxing) and Abhinav Bindra (Shooting) disappointed us, the following SIX made India proud. We Salute them for their achievements!

Vijay Kumar, Shooting - Silver
Sushil Kumar, Wrestling - Silver
Mary Kom, Boxing - Bronze

Saina Nehwal, Badminton - Bronze
Gagan Narang, Shooting - Bronze
Yogeshwar Dutt, Wrestling - Bronze

Sensible Political Decisions

The last week of July saw some sensible political decisions in the infrastructure arena.

There is no doubt that availability of land, that also in time, is one of the most cited reasons by the project promoters for the delayed off take of projects in India. The recent step taken by the Indian government to do away with the Cabinet Committee permission for transfer of government owned land for public-private-partnership (PPP) projects is expected to expedite the project implementation by a minimum of six months. As per the new guidelines land transfer from Central ministries to statutory bodies or public sector undertakings will now be outside the purview of Cabinet clearance.

Though Uttar Pradesh government has been identified as one of the erring states which plunged 19 Indian states into darkness by drawing more than allotted power, last week the government took some fruitful decisions also. First, the UP chief minister laid the foundation stone for the Rs 2,770 crore road project being set up by SEW Infrastructure.  The BOT project seeks to take up four laning work of the 206-km stretch between the Delhi–Saharanpur section. 

To top it the chief minister has agreed to inaugurate the six laned access-controlled Yamuna Expressway on 9 August 2012. The 165 km expressway was awarded and built during the BSP government regime. The expressway built at a cost of Rs 14,000 crore is expected to reduce the travel time between Agra and Greater Noida from four hours to around one-and-half hours.

Quote of the week

“The situation looks challenging, no doubt, but we simply have to get accustomed to dealing with these headwinds. What gives us hope is that the Indian consumer is aspiring for a better life,” Nitin Paranjpe, CEO & MD, Hindustan Uniliver Ltd.