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.