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Roads' appetite for investment huge: Survey

The Survey asked Govt to gear up policies and institutions to meet specific requirements while increasing the outlay for road sector.

india Updated: Feb 27, 2006 14:33 IST

Identifying the need for Rs 1,72,000 crore investment in national highways, the Economic Survey asked the government to gear up policies and institutions to meet specific requirements while increasing the outlay for road sector.

The 2005-06 Survey, tabled in Parliament, said the total investment requirement was enormous. "Policies and institutions need to be geared up to meet the specific requirements of the infrastructure sectors in India."

Acknowledging an increase in budgetary outlay on roads financed through the enhanced road cess on petrol and diesel in 2004-05 and 2005-06, it said there is "need for faster consolidation as per the Fiscal Responsibility and Budget Management Act (FRBMA) to open up fiscal space for higher outlays, both physical and social, continues."

The Survey said the completion of substantial portions of the Golden Quadrilateral, envisaging four/six laning of highways connecting Delhi, Mumbai, Chennai and Kolkata, was fuelling demand and facilitating the growth of productivity in the country.

"The model concession agreement, which has been finalised for the roads sector, is expected to give a further impetus to the timely completion of the road projects," it said.

Stating the port connectivity was still the soft underbelly of the port sector, the Survey said the current efforts to bolster it would improve freight movement in the medium term.

The Survey said as on November 30, 2005, 6,271 km of roads under National Highway Development Project - with the bulk of 5,097 km lying on the Golden Quadrilateral - was complete. Another 6,179 km was under construction.

The award of contracts of the entire Phase-II - the North-south and East-West Corridors connecting Srinagar with Kanyakumari and Silchar with Porbandar - was likely to be completed by March 2006, except for Jammu and Kashmir and West Bengal, where there were difficulties of terrain, alignment and environmental clearance.

"It is expected that the GQ would be substantially completed by June 2006, and the NS and EW corridors would be completed by December, 2008," the Survey said.

Thirty-one Build-Operate-Transfer (BOT) contracts covering 1,600 km under Phase-II and Phase-IIIA (4-laning of over 4,000 km roads) have been awarded. Phase-IIIA was targeted to be completed by December, 2009.

"The constraints faced in the timely completion of NHDP are: Delays in land acquisition and removal of structures; law and order problem in some states; and poor performance of some contractors," it said.

First Published: Feb 27, 2006 14:33 IST