Highways ministry working on model pact to suit global investors
The highways ministry is formulating a model pact for its projects to suit the needs of private investors, especially from the US, the Middle-East and Singapore, who have shown keen interest in operating them. Several investors, including Canadian Pension Fund, Abu Dhabi Investment Fund and some from the US, Europe and Singapore, have shown interest in buying various projects. As many as 10 public-funded national highway projects, out of a basket of 75, have been identified by the government for monetisation. “We are in the process of formulating a model concession agreement (MCA) to suit the needs of international investments,” a ministry official told PTI. “A large number of global investors have evinced interests in our projects and some of these meetings have been facilitated by Morgan Stanley and Brookfield Asset Management,” he said. The official said investors have expressed interest in toll operate transfer (TOT) projects and a consortium of investors are keen to invest here. “This special MCA being drafted will be for a wide spectrum of projects including in the highways, railways, Delhi Metro Rail Corporation and Waterways,” the official added. “In the first week of August, we could expect to see the first bundle of 10 out of 75 TOT projects out for bidding,” the official said. The government in August last year had authorised the National Highways Authority of India (NHAI) to monetise public-funded highway projects in the country. Road Transport and Highways Minister Nitin Gadkari had earlier said that monetisation of public-funded highway projects could result in funds in the range of Rs 80,000 to Rs 1 lakh crore initially. Ever since the government’s nod for monetisation, NHAI has been conducting traffic studies related to such projects, the revenue streams available and their overall viability. The corpus generated from proceeds of such project monetisation could be utilised by the government to meet its fund requirements regarding future development and operation and maintenance of highways in the country and could address development of highways in unviable geographies. Market feedback indicates that certain institutional investors from outside the country have long-term investment appetite and are keen to participate in operational highway projects with stable toll revenue outlook. These investors generally hesitate from taking construction risk but are willing to look at de-risked brownfield road assets, the government has earlier said. Roberto Luongo Womens Jersey
Rs 7 lakh crore to be spent on highways in 5 years
In the next five years, approximately Rs 7 lakh crore will be spent in building and expanding highways and constructing expressways across the country . While barely 15 per cent of this investment will come from the private sector, the remaining 85 per cent will come from fuel cess and toll, monetisation of completed highway stretches and NHAI raising funds from the market. Road construction is considered a major employment generator. Sources said around 40,000 km of highways will be expanded till 2022, which includes about 24,800 km covered under Bharatmala programme. According to government estimates, construction of 10,000 km of highways annually has the potential of generating four crore mandays and this can be a weapon to blunt the opposition’s allegation that the government has failed to create employment opportunities. TOI has learnt that the interministerial panel for approving government investment known as Public Investment Board (PIB) has approved the Bharatmala programme and the entire financing plan for highway development for five years is set to be cleared. It is also learnt that the NHAI Board, which will have representatives from ministries and Niti Aayog, will get the authority to appraise and approve projects up to Rs 2,000 crore. “This will ensure faster rolling out of projects. Works involving more than Rs 2,000 crore will be taken to the Cabinet for approval,” a government source said. Officials admitted that private investment was likely to be much less than the desired level of at least 30 per cent and hence government has to invest in a big way to push infrastructure growth.With the government making it clear that user charge or toll will be collected on viable stretches, NHAI will recover the investment. It can even auction completed highways projects to private players to get money upfront for fresh projects. For construction and widening of identified projects, the government aims to generate Rs 34,000 crore by monetising some of the completed stretches. The prime minister’s office has asked the highways ministry to accelerate monetisation of completed projects. Jason Verrett Womens Jersey
Solar power helps pump up petrol sales amid power shortage
Solar energy is displacing fossil fuels across the globe. But in India, it is helping boost sales of diesel and petrol at filling stations. As petrol pumps start using solar energy, many of them, especially in the hinterland with ample sunlight, are reclaiming as much as 10 per cent of sales earlier lost due to inadequate and erratic grid power supply. Some of the newer pumps have opted for solar only to avoid the higher cost of grid power. “Solar is not just about being environment-friendly. It is paying off financially as it helps raise sales as well as bring down the operating cost for petrol pumps,” said AK Sharma, director (finance) at Indian Oil Corp, the nation’s largest fossil fuel retailer, which has about a quarter of its 26,500 pumps using solar energy. Hindustan Petroleum and Bharat Petroleum have about 9 per cent and 7.5 per cent of their pumps using solar energy, respectively. Three years ago, Vikas Sharma, the manager of an Indian Oil pump at Bhojpur in Ghaziabad district, would lose up to 10 per cent of his monthly sales as electricity was available for only 8-10 hours daily, not necessarily during business hours. “Not every customer is ready to wait. By the time you get your boys to start the backup generator, the customer would have left. That’s the cost one pays daily for being dependent on grid,” said Sharma, who runs a fuel outlet for rural customers, about 50 km from the Delhi border. Sometimes the staff at filling stations is too lazy to even start the generator, knowing the cost of running it would be more than the money made from a motorcyclist wanting to fill Rs 20 worth of petrol. “All these accumulate into a substantial loss of business in a month,” said Sharma, who installed solar panels in early 2015 at his decade-old pump to the meet fuel demand that’s growing with rising rural incomes and roads getting increasingly better. “This has changed everything for us,” he said, pointing to the silicon sheets shining in the summer sun on top of his sales office at the filling station surrounded on three sides by fields awaiting sowing of the season. “Earlier, half the time our boys would be busy calling up the grid power supplier’s office to correct faults, or starting the diesel generator or getting some mechanic to repair the generator if it was acting up,” he said. With quality power supply from solar, even the cost of equipment maintenance has fallen. In about two and a half years, Sharma has more than recouped his investment of Rs 5.5 lakh on solar installation. His electricity bill halved to Rs 7,000 a month and expenses of Rs 15,000 a month on the backup generator disappeared, saving him Rs 22,000 a month. Sharma isn’t going totally off-grid because it would be difficult if he ever wanted to draw power from the grid in future. On the other hand, dealers like Prabhat Tyagi have never looked at grid as an option. He has relied on solar for all energy needs since 2012, when he started operating a filling station in Ghaziabad. “The initial cost of connecting to a grid was Rs 2.5-3 lakh then. And for a supply of 6-8 hours a day, I would have had to pay a minimum Rs 5,000 every month. Add to this cost of a diesel generator. Therefore, I chose solar installation, which came for Rs 6 lakh and no operating cost.” Brandon Allen Womens Jersey
Plans afoot for five cruise terminals worth Rs 1500cr: Nitin Gadkari
The government will invest Rs 1,500 crore to develop five cruise terminals in the country, shipping and roads minister Nitin Gadkari said on Tuesday. Gadkari said these terminals will be built in Mumbai, Goa, Chennai, Cochin and near Kandla port by the world’s best cruise tourism and terminal operation companies. The shipping and tourism ministries have jointly engaged EY to draw up an action plan for the development of cruise tourism in the country to realise the immense potential of the sector. The government also wants to ease the security, immigration, customs and health clearances for foreign tourists arriving in India through cruises. The minister said government-owned major ports will be investing heavily in this new vertical as he’s anticipating almost 700 cruises to come to India in the coming years. Last year, over 100 cruise liners brought foreign tourists to India, mainly to Mumbai. “Almost 10 lakh Indians book cruises and most of them go to Singapore to board it. We could develop the same facilities here,” he said. The minister said various Singaporean companies operating the cruise lines business have shown interest to start operations in India. “I have met the top heads of SATS-CREUERS and PSA. These are among the world’s best cruise terminal management companies, and both have told me that they want to construct top class cruise terminals in India,” Gadkari said. “Currently, we have no international style cruise terminals here. How would you have cruise tourism when there’s no terminal? I have told them we’ll soon float the tenders and they can participate in the bidding. We also want to build floating restaurants in Mumbai. The port trust is floating tenders for this,” he said. Gadkari also said he was in talks with a major airline of the country to start seaplane services between Delhi and Mumbai. “I want to make Mumbai-Goa navigable through waterways for the common public. I’ve proposed this to the promoters of one of the top Indian air carriers. They are studying the feasibility.” Anton Stralman Jersey
ONGC Gets Shale Go-Ahead
State-owned explorer ONGC Ltd has got an environmental clearance to drill five wells for shale gas and oil in the Krishna-Godavari (KG) basin at an estimated cost of Rs 217 crore. ONGC had proposed further exploration of shale gas and oil in the KG basin and was examined by the environment ministry. “The proposal was first vetted by the expert appraisal committee. Based on its recommendation, the environment ministry has given the final environment clearance to ONGC for exploratory drilling of five wells in the KG basin,” a senior government official said. The approval has been given subject to certain conditions. According to the proposal, ONGC plans to drill wells in the onland blocks in West Godavari, Bantumilli extension, Suryaraopeta, Mahadevapatnam and Mandapeta in Krishna, West Godavari and East Godavari districts to assess the potential of shale. San Francisco 49ers Jersey
Indian Minister Discusses Gas Supplies With Russian Deputy Energy Minister
India’s Petroleum and Gas Minister Dharmendra Pradhan said Tuesday that he had discussed supplies of natural gas to the Asian country during a meeting with Russian Deputy Energy Minister Yuri Sentyurin and the delegation from Russia’s energy giant Gazprom. “Received the Russian Deputy Minister of Energy & @GazpromEN officials. Had a discussion on proposed gas pipeline to India,” Pradhan said on his Twitter account. In 2013, Moscow and New Delhi agreed to create a joint expert group to consider gas deliveries to India through above-ground pipelines. In 2016, Gazprom and Engineers India Limited company signed a memorandum of understanding reflecting the interest of the parties in jointly exploring routes for pipeline gas supplies from Russia, and other countries, to India. On June 15, 2017, Gazprom Deputy Chairman of the Management Committee Alexander Medvedev said that the company was considering the supplies of natural gas to India, adding that swap operations with China and Iran could take place under this process. Justin Blackmon Womens Jersey
USIBC sets up India task force on civil aviation
The US-India Business Council has constituted a task force to identify opportunities in the Indian civil aviation sector. The task force, chaired by engine maker Pratt & Whitney’s managing director (India) Palash Roy Chowdhury, will focus on identifying opportunities based on the National Civil Aviation Policy (NCAP), a release said. Amber Dubey, partner and head of aerospace and defence at leading consultancy KPMG in India, will be the co-chairman of the India task force. “The task force will engage with various stakeholders to promote international best practices and address potential hurdles that surface as American and Indian companies deepen engagement in India’s burgeoning civil aviation market,” the release said. Registering double-digit growth for more than two years, India’s domestic aviation sector is one of the fastest growing in the world. Chowdhury said the task force would seek to support growth of US corporations in India by aligning with the priority areas of the Indian government. “Our member companies are committed to the success of the government’s flagship programmes such as the Regional Connectivity Scheme and Make In India, and bringing the best in technology in related areas such as airport infrastructure and security…,” USIBC President Mukesh Aghi said. Randy Gregory Jersey
Need to make commercial planes in India, says SpiceJet chief
India should come out with policy initiatives for local manufacturing of commercial planes as its aviation market is poised to become the third largest in the world, SpiceJet chief Ajay Singh said. SpiceJet got a shout-out from US President Donald Trump, as he stood along with Prime Minister Narendra Modi in the White House Rose Garden, for orders placed with US aircraft maker Boeing. “I was pleased to learn about an Indian airlines’ recent order of 100 new American planes, one of the largest orders of its kind, which will support thousands and thousands of American jobs,” Trump said, without naming SpiceJet which has placed the USD 22 billion order. Singh, who has piloted the no-frills airline out of troubled times, said the Indian government should come out with policy initiatives for manufacturing commercial planes inside the country. “It (making commercial planes in India) has not been given a thought to, at the moment,” Singh told PTI in an interview. When the government can talk to companies like Apple about assembly of phones, why not the plane manufacturers, he wondered and stressed that the government needs to start discussions with aircraft makers to understand what they need. Noting that India is projected to become the world’s third-largest commercial aviation market by 2020, Singh said Indian airlines have placed orders for more than 600 commercial planes. If the Indian government can push for making military planes — when the orders are for little over 120 – it is time that New Delhi thinks on those lines for commercial planes too under the ‘Make in India’ programme, Singh said. “They have been talking about it on the military side but on the commercial side, there has been nothing much,” the SpiceJet Chairman and Managing Director said. India’s domestic aviation market is one of the fastest growing in the world and has been witnessing double-digit growth for more than two years. “I think we need to…put some pressure on our manufacturers, much as we are doing on the (fighter jets) transaction. “To say that look, there is a huge market available for you in India, so why don’t you manufacture here? Perhaps, there can be some form of concessions given to people who might want to manufacture in India. Both tax concessions as well as creating a market opportunity for them,” Singh said. Mentioning the opportunities, he said: “We are growing 20-25 per cent. Despite this growth, there are only three percent of the Indians that fly, so obviously the potential is really immense. “Supposing we were to say that look, in the regional connectivity scheme, you will have to use aircraft which are manufactured in India. There is automatically a market which opens up.” The ambitious regional connectivity scheme aims to connect unserved and under-served airports in the country as well as make flying more affordable. SpiceJet operates 364 average daily flights to 46 destinations, including 7 international ones. It has a fleet of 35 Boeing 737NG and 20 Bombardier Q-400 planes. SpiceJet had announced an order worth USD 22 billion with the US aircraft maker in January. The order is expected to create 1.32 lakh high-skilled jobs in America. Last month, the airline also signed an initial pact for 40 Boeing 737 MAX planes. This includes conversion of 20 737 MAX 8 airplanes from its existing order of 737 MAX 10s. Responding to a question, Singh said SpiceJet order alone is creating thousands of jobs in the US. “We wanted to bring home the point that, as India does well, as our economy does well, as Indian aviation does well, companies like SpiceJet order more and more planes. “We are actually helping create a very large number of jobs in the US,” he said. Singh also said that India should be looked upon as not only a strategic partner in a military context, and in the context of two countries together fighting terrorism, but also as a strategic partner that helps create jobs in the US. Eddie Vanderdoes Authentic Jersey
Donald Trump lauds SpiceJet’s $22-billion order to Boeing
SpiceJet has been cited by President Donald Trump for doing its bit to create US jobs through a $22-billion order for Boeing planes, capping a turnaround effort by the airline that had been on the brink of closure in 2014. “I was pleased to learn of an Indian airline’s (SpiceJet) recent order of 100 new American planes, one of the largest orders of its kind which will support thousands of American jobs,” the US president said in the joint press conference with Indian Prime Minister Narendra Modi. Trump, a professed advocate of US-based businesses, was unequivocal in his stance that the trade deficit in favour of India should be reduced. Since Trump’s inauguration, protectionist rhetoric has been rising in the US, putting a question-mark over the remote-services-based business model that has spawned global outsourcing giants Infosys, TCS, or Wipro. Amid mounting demands for job protection in the US and stricter visa controls, Indian technology companies have also begun hiring more hands in North America. “This is a $22-billion order and these planes will be manufactured in the US. As per the US Department of Commerce, it creates 132,000 high-skilled, high-paid American jobs within the US,” SpiceJet Chairman Ajay Singh said in a statement. At present, SpiceJet is the only low-cost carrier in India that has placed big aircraft orders with Boeing: Its peers prefer Airbus instead. IndiGo, GoAir, AirAsia and Vistara are all operating Airbus fleet, making the European aircraft maker the market leader in the single-aisle space in the country. Between IndiGo and GoAir, Airbus has aconfirmed order book of over 550 single-aisle Airbus 320 aircraft. In contrast, SpiceJet has ordered up to 205 planes from Boeing, including 40 new Boeing 737-10 aircraft, enabling the Seattle-based aircraft maker to make a dent in the Indian market. SpiceJet, which ceased operations for a day on December 17, 2014, due to lack of funds to pay oil companies, has seen 12 consecutive profitable quarters since then. The turnaround happened after Ajay Singh took over the company from Dayanithi Maran’s Sun Group. It has also benefited from the decline in global oil prices. The airline, which was weighed down by liabilities of about Rs 1,500 crore, has managed to reduce liabilities and now fully funds its working capital with internal accruals. Other than SpiceJet, Jet Airways had ordered 75 Boeing 737 Max in 2015. Air India and Jet Airways are the two carriers in India operating a fleet of both Boeing and Airbus aircraft. For aircraft makers, India and China are important markets. India’s civil aviation market has averaged a growth of 20%, making it one of the fastest-growing markets in the world. Singh said that funding arrangements for all aircraft on order are coming very quickly in place. “We have already funded a significant number of those aircraft through a sale and leaseback mechanism. And we have several offers. We really see no great challenge to funding these planes. Going further, we will take a call, depending on what is cheaper for us at that point in time…Fortunately, we are in a pretty conducive financial environment, where interest rates are low across the world,” Singh said. Carson Wentz Authentic Jersey
Government stitches rescue plan for Tata, Adani power plants
The biggest rescue package being stitched together for distressed power plants could see lenders take over three imported coal-fired generation stations of the Tata, Adani and Essar groups, involving an estimated investment of over Rs 40,000 crore, and transfer 100% equity for Re 1 to consumers states, including Gujarat where these plants are located. But the transfer of ownership of these plants, aggregating a capacity of 9,820 MW, will not get the promoters off the hook as far as bank loans are concerned. At a meeting of stakeholders, called by the power ministry on June 20, lenders insisted that the corporate guarantees given by the promoters will continue even after the change in ownership. The plan hinges on the outcome of due diligence conducted by India’s biggest generation utility, state-run NTPC. Sources in the know said the promoters offered to operate and maintain their respective projects even after the ownership transfer. But Gujarat Urja Vikas Nigam Ltd said the state would prefer to source coal, which is at the crux of these plants becoming unviable. Both the Adani and Tata groups have made the audacious offer to sell majority stake in their projects, located at Mundra in Gujarat, for Re 1 to the state. These projects became unviable after the Supreme Court denied higher tariff to compensate for increase in fuel costs due to policy changes in Indonesia, where the captive coal mines are located. It is not clear at the moment whether Gujarat alone will take over the ownership of these plants or the states will take ownership in proportion to the quantity of capacity they have tied up under the 25-year power purchase agreements. Once the change in ownership of these projects, awarded through tariff-based bidding, will turn them into public property. This will allow new owners to seek suitable tariff from regulators under ‘cost-plus’ formula to make them viable and save banks from being burdened by additional non-performing assets. Government officials said the scheme will not burden consumers and provide power that will be cheaper than alternative sources. “These are modern assets, efficient power source. Look at how much variable cost (essentially fuel price) states are paying to alternative sources. Rs 4-4.50. So if fuel cost for these plants is brought down by blending domestic coal, the overall impact on tariff may be minimal, if at all. But it will still be cheaper than alternative sources,” one official told TOI. The sources said, the Tata group has been asked to examine the option of changing boiler configuration to allow use of domestic coal — at least for blending imported coal by 30% — to reduce fuel cost. They said the Adani group is already using 30% domestic coal to reduce costs. Jaromir Jagr Jersey