After raising a Rs 1,500-crore loan to pay salaries to government employees and to meet its financial obligations in the past six months, the "cash-strapped" Punjab government has now approved the Public Works Department (PWD) proposal to "mortgage" its properties for raising a bank loan up to Rs 1,000 crore for construction of new "toll" roads.
Though the department had proposed to mortgage its properties to raise Rs 1,500-crore loan for construction of nine roads, the state cabinet, in its August 9 meeting, approved the loan proposal up to Rs 1,000 crore. The cabinet also asked the Punjab Infrastructure Development Board (PIDB) to pay 15% of the project cost to the department while the rest would be generated through loans.
Fifteen days later, chief minister Parkash Singh Badal, however, publicly declared at Midda village in Muktsar that there was 'no' proposal to mortgage government properties for raising loans. In Qadian on Saturday, Badal again stuck to the statement regarding no dearth of funds with the government.
The note placed before the cabinet said the scenario in public private partnership (PPP) was not encouraging in the road sector. "Private contractors failed to fulfil conditions precedent even after expiry of 180 days of allotment of three road projects in Punjab. No bids were received for six road corridors even after bidding projects thrice. Even the PPP projects of Punjab have evoked poor or no response from the bidders due to current scenario in the sector," the note read, demanding budgetary support or permission to mortgage the PWD properties for raising Rs 1,500-crore loan.
The department admitted that the riding quality of state highways (SHs) and major district roads (MDRs) is fair to poor. "The traffic on majority of these roads was growing up to 8% per annum, thus, leading to serious congestion. The average speed of trucks and buses ranges from 35 to 45 km per hour, thus resulting in higher fuel consumption and pollution. As many as 3,424 people were killed in 6,641 road crashes in 2010. This is near 100% increase over the past one decade. Increased vehicular traffic, poor geometric design, inadequate signage, inefficient traffic rules enforcement are major contributors to the increase in road accident deaths," the note said.
The cabinet constituted state-level empowered committee headed by deputy chief minister Sukhbir Badal to approve and implement nine road projects. Sharanjit Dhillon, PWD minister; chief secretary, financial commissioner (revenue); principal secretary (finance); PWD secretary; PIDB managing director; and joint secretary, Punjab Road and Bridges Development Board; were appointed as members. The detailed project reports would be submitted by technical consultants within two months while projects would be accomplished in 18 months.
Sukhbir, before leaving for his foreign trip recently, approved five out of nine road projects estimated to cost nearly Rs 800 crore. While three projects were cleared in Malwa region, one each was approved for Doaba and Majha regions. "The department will construct these roads on its own and will collect toll tax from the users to pay back the loans," sources said.
Approval granted to toll tax road projects
1. Four-laning of Rampura-Maur-Talwandi Sabo road
2. Four-laning of Dharamkot-Zira road
3. Four-laning of Muktsar-Malout road
4. Widening of Mukerian-Gurdaspur road
5. Widening of Phillaur-Naggar-Rahon road
Left out toll road projects
6. Ratiya-Boha-Budhlada-Bhikhi road (upto Budhlada)
7. Barnala-Mansa Sardulgarh-Sirsa (upto Haryana border)
8. Kapurthala-Tarn Taran-Chhabal-Attari road (upto Goindwal Sahib)
9. Chandigarh-Landran-Chunni-Sirhind-Patiala road (up to Sirhind)
Financial assistance availed in past
1. Rs 1,500-crore World Bank loan in 2007 to upgrade 921-km roads
2. Rs 1,618-crore National Bank for Agriculture and Rural Development loan to upgrade 4,105-km roads
3. Rs 668 crore under the Central Road Fund scheme to upgrade 969-km roads