Telangana CM meets Nitin Gadkari, seeking approval for 4 lane National Highway project
Telangana Chief Minister, K Chandrasekar Rao, met Union Minister for Road Transport and Highways and Shipping, Nitin Gadkari in the national capital on Monday to seek approval for the upgradation of additional 500 kilometres of roads as part of the four lane National Highway project in the state. Apart from the Chief Minister, Tummala Nageswara Rao, Roads and Buildings Minister and other Telangana Rashtra Samithi (TRS) parliamentarians were also took present in the meeting. During the discussion, K C Rao led delegation urged Gadkari to expedite the Land Acquisition as per the state procedure and sanction projects amounting to Rs 3572.16 crore with regard to four lane which was handed over to the National Highway Authority of India (NHAI) on August 10. The Chief Minister also requested the Union Transport Minister to convene a separate committee to look into the issues of sparing Defence lands for the expansion of Paradise junction to Bowenpally section of NH 44 and instead form an alternate route in lieu of roads proposed for the closure in Secunderabad Cantonment. “We have appealed to the government to contribute to the expansion of the land of the roads in Telangana,” Nageswara Rao told the media in New Delhi. The national highways that are proposed by the state government to convert it into four lane are Sangareddy (NH161),Narsapur-Toopran-Gajwel-Jagdevpur- Bhongir-Choutuppal (NH-65); Choutuppal –Ibrahimpatnam-Amangal-Shadnagar-Chevella-Shnkarpally-Kandi(NH 65);Medak-Siddipet-Elkathurthy (NH 563), and Junction at Hyderbad Outer ring road-Valigonda-Thorrur- Nellikuduru-Mahububabad-Yellandu-Kothagudem (NH 30). This came after the state government’s endeavor to convert 4000 kilometres road into National Highways after it disintegrated from Andhra Pradesh. So far, Gadkari has agreed to convert 1300 kilometers in the first phase of the project. Ronnie Lott Jersey
NHAI to raise Rs 55K crore via EPFO, LIC, bonds this fiscal
To finance its various projects, National Highways Authority of India (NHAI) plans to raise Rs 55,000 crore in the current fiscal, government said today. It will raise Rs 20,000 crore through EPFO, Rs 8,500 crore through LIC, Rs 5,000 crore each through Masala and 54-EC bonds and Rs 16,500 crore from the market, Minister of State for Road Transport and Highways Mansukh L Mandavia told Rajya Sabha today in a written reply. “The coupon rate for the fund raised/to be raised from EPFO is based on 10 days moving average of 25 years G-Sec plus 24 bps,” Mandaviya said. LIC has conveyed in-principle approval for subscribing to NHAI Bonds of Rs 25,000 crore to be drawn in three financial years till March 2019, subject to maximum of Rs 8,500 crore in one fiscal, he said. LIC has offered coupon rate of 30 years maturity at G-sec rate plus 50 bps per annum and the reference G-sec rate shall be 15 working days average annualised G-sec rate. The minister said NHAI has a common bank account in which all the funds raised/received are kept and the expenses are incurred from this account towards development, maintenance and management of National Highways entrusted to it by government. Ethan Westbrooks Womens Jersey
Haryana’s first ‘Green Road’ to be constructed in Gurugram
Haryana’s first “Green Road” will be constructed at village Lokra near Pataudi in Gurugram district. The 2.24-kilometre long road would be constructed by the state Public Works (Building and Roads) Department at a cost of Rs 1.25 lakh. Sand will be used in this latest technique of road construction rather than bitumen and other elements spreading pollution. “My department, on an experimental basis, will construct such three roads in Karnal, Hansi and Pataudi. Moreover, development works to the tune of Rs 10,000 crore are being carried out in the entire state. The Dwarka Northern Peripheral Road would be upgraded as 16-lane National Highway which would be the widest highway in the country,” said Haryana Public Works (Building and Roads) minister Rao Narbir Singh on Saturday while laying the foundation stone of first Green Road at village Lokra. “There is a plan for metro extension up to Subhash Chowk in Gurgaon and residents will also get to use Metro soon. The Manesar-Palwal expressway has already been dedicated to the people and Manesar-Kundli section would be completed in 400 days as its construction has already been started. An elevated flyover would also be constructed at a cost of Rs 700 crore from South City to Badshahpur,” he said. Vinny Curry Jersey
DELHI-MEERUT E-WAY FACES BARRIERS DESPITE PM’S PUSH
Almost a year has gone since Prime Minister Narendra Modi laid the foundation stone of the Delhi-Meerut Expressway in December last year. However, much to the chagrin of the Prime Minister, who is pushing for infrastructure development — including roads and highways—the ambitious National Highway-24 (NH-24) expansion project is yet to take off. After the Prime Minister reportedly pulled up authorities for not doing proper groundwork and getting him to lay the foundation stone for the project, a high-level meeting was held which identified eight major bottlenecks for 14-laining of NH-24 to kick off. According to the agencies, encroachment by slums, residential building, including Deputy Chief Minister’s office; clearance for construction of bridge over Yamuna at Nizamuddin; permission for cutting of 3,261 trees; shifting of utilities of DJB, BSES and Delhi Transco; and shifting of religious structure are the major hurdles to the project. A document pertaining to the project accessed by The Pioneer reveals that there are several private residential buildings on right of way (ROW) while several similar structures are inside ROW of the National Highway 24. Besides, Nehru Camp Juggis, Patparganj having 1,500 dwelling unit exist within 90 metre on ROW of NH-24. The Delhi Urban Shelter Improvement Board has been directed to submit proposal for rehabilitation of the jhuggi dwellers within two weeks. The document also said Joint Inspection is yet to be done to ascertain the extent of shifting L&T batch mixing plants at UP Link Road-NH 24 and NH 24-Ring Road for Barapullah elevated corridor casting yard. Several nurseries of the municipal corporations, which fall outside the ROW, are expected to be shifted in four weeks. On dismantling the Deputy Chief Minister’s office also falls under ROW of NH, the PWD chief engineer has reportedly assured that these structures would be cleared within next four weeks. For the construction of a bridge over the Yamuna River at Nizamuddin as a part of the Delhi Meerut Expressway, the concerned agencies have yet to give clearance as the Delhi Development Authority (DDA) has not given clearance for land for the bridge project. The DDA has said that the matter was under consideration and has requested for a joint inspection. The representatives of PWD present in the meeting also informed that part of the land required by NH is on lease with PWD for casting yard. The NHAI which is implementing the project has requested the Delhi Government’s forest department to give permission to cut 3,261 trees in the Delhi area on NH 24. Russell Wilson Jersey
Bengaluru: Government fast-tracks projects on alternative roads to KIA
With the steel flyover project stuck in a legal tangle, government agencies are acting fast on alternative road projects to link the Kempegowda International Airport (KIA) with various points of the city. The public works department has submitted a proposal to widen KR Puram-Budigere Road to a four-lane highway. M Lakshminarayana, principal secretary for PWD and transport department, said: “We are planning to widen Budigere Road and are awaiting government approval. The plan is to make the single road into a four-lane to facilitate flyers and freight movement to the airport from eastern and south eastern parts of the city.” The state highway-104 goes hrough Singanahalli that connects Budigere Road in the south and KIA on the northeastern side. It starts from the Bengaluru-Tirupati highway enroute to Nellurhalli. This is already a 20-km distance and will take roughly 30 minutes for citizens to reach the airport from Begur village. BIAL has planned to open a gate towards Begur on the southern side of the airport, where it’s constructing a second runway; a terminal will also come up. The Bangalore Metro Rail Corporation (BMRC) had suggested to connect Metro to KIA from KR Puram via Budigere Cross and Sathnur, and many citizens living in Whitefield, Bellandur and Sarjapur were in favour of this. Chief minister Siddaramaiah visited these villages on October 17, a day after citizens formed a human chain along Ballari Road against the government’s decision to cut 812 trees for the flyover project without detailed public consultation. He inspected the Thanisandra and Hennur roads that meet at Bagalur leading to OI Mylanahalli village and said they will be developed as alter native routes to the airport. KIADB has already started acquisition of 13 acres and three guntas from three villages in the southern side of the airport towards the second terminal–Mylanahalli, Chikkana halli and Begur. KIADB has asked PWD to release Rs 55 crore in advance as acquisition A deposit to be paid to villagers. “The price advisory committee meeting will be conducted after final notifications issued as per the KIADB Act,” said Pankaj Kumar Pandey, CEO, KIADB. He said there’s no question of displacement of families be s cause 101 owners of khatas will lose a few guntas each of tillavble land. “The primary notification was issued and objections ct are being heard on November 22 and 23 before the special land nacquisition officer after which at a final notification will be isto sued,” Pandey added. Harrison Butker Womens Jersey
Nepal cancels fast track road project with India’s IL&FS
In a surprise move, Nepal on Sunday announced the cancellation of all agreements with India’s Infrastructure Leasing and Finance Services for construction of a fast track road linking Kathmandu and Tarai. The Nepal government and IL&FS had signed an agreement in March to prepare the detailed project report ( DPR) of the $1 billion road project. At a meeting of the parliament’s development and finance committees, Ramesh Lekhak, Nepal’s planning and infrastructure minister announced all pacts signed with IL&FS are no more valid and all public announcements made by the Nepal government to develop the project are nixed. There was huge uproar in Nepal over awarding the projects to an Indian company after the then Sushil Koirala-led government decided to award the contract to IL&FS. IL&FS had spent over 40 million rupees for DPR and other paperwork, which the Nepal government has to compensate the Indian firm. Some experts expressed concern over the financial arrangement wherein Nepal has to reimburse the Indian firm. The government of K P Oli, which took over after Koirala, decided to construct the project using its own resources and allocated 5.5 billion rupees to construct the project. Given the strategic importance of the road, the current government has listed it as a national pride project. Minister Lekhak said, “Now all bodies concerned should make decision standing together in course of taking the nation’s pride project ahead.” Lekhak said the government has tabled a proposal for constructing the 76 kilometres of the road with its own investment. In October last year, Nepal’s Supreme Court had issued an interim order halting the government’s preparations to award the project to the Indian developer. During the International Conference on Nepal’s Reconstruction in June 25, 2015, Indian External Affairs Minister Sushma Swaraj had pledged to expedite construction of the projects. “Work on construction of the Kathmandu-Nijgadh fast track road and the Nijgadh airport with India’s participation be expedited. These projects will create new job opportunities, contribute to revenue, and facilitate long-term recovery,” she had said. Dennis Smith Jersey
NHAI terminates Samrala Chowk, Kishangarh-Udaipur-Ahmedabad projects
With lenders doubtful over the completion of Samrala Chowk and Kishangarh-Udaipur-Ahmedabad (KUA) Package VI projects, the National Highways Authority of India (NHAI) has terminated the ventures, sources confirmed to FE. Both projects were to be built through the hybrid annuity model (HAM). Raghav Chandra, chairman, NHAI, told FE that both the projects have been terminated. Chandra, however, denied that banks were uncomfortable lending to the projects. “KUA Package VI was annulled and Samrala Chowk was rebid as the bids were not found to be proper. We have received two bids for Samrala Chowk now,” the NHAI chairman said declining to give further details. Samrala Chowk-Ludhiana in Punjab and Kishangarh-Udaipur-Ahmedabad (Package VI) in Gujarat, won by Gawar Infrastructure and Overseas Infrastructure (Alliance) (OIA), respectively, were bid out between April and June 2016. However, both the projects missed the deadline of 150 days within which the financial closure must be achieved, sources said. Gawar bagged the Samrala Chowk-Ludhiana project in mid-April at a bid amount of R1,049 crore, 23% higher than the NHAI bid of nearly R853 crore, according to a report from Jefferies. Details of KUA (Package VI) which was bagged by OIA around July this year could not be ascertained. Overseas Infrastructure did not respond to the email sent by FE seeking responses over the termination of the project till the time of going to the press. Repeated calls made to Gawar remained unanswered. Industry watchers say lenders are being choosy when it comes to backing the contractors bidding for HAM projects. Of the 30-odd road projects bid out so far, only about 10 projects are understood to have achieved financial closure. “Banks are following a stringent process to assess HAM projects. Only contractors with an execution track record and strong balance sheets have managed to get loans, for others it’s a challenge,” said a top executive of an infrastructure firm which managed to access bank funds for one of its HAM projects. Banks have suggested to the ministry of road transport and highways (MoRTH) that the compensation or termination charges, in the event of the concessionaire’s inability to complete a project, should be 100% of the debt due. “The entire loan amount or most of it would have been drawn down, except perhaps for a small sum,” a banker explained. Currently, the rules for HAM projects stipulate a far lower level of compensation to lenders which is worrisome for them. Lenders also want NHAI to not insist on a guarantee for extending an advance in the early stages of construction. Among the projects that were bid out in March and April, MEP has achieved financial closure for two projects with four more under evaluation. Two projects awarded to MBL are also being evaluated as is the Delhi-Meerut Expressway, Package III, awarded in December 2015. Sadbhav has also achieved financial closure for two projects. However, financial closure of the project bagged by Eagle Infra in April is taking longer than expected. Forrest Lamp Authentic Jersey
Demonetisation to hurt toll-road operators in short term
An expected decline in road traffic and the exemption of road tolls following the withdrawal of high-value banknotes may pose short-term cash flow concerns for toll road operators, companies and analysts said. While the government plans to compensate these companies for their toll loss, there would likely be short-term pain as traffic plunges on account of low economic activity, they said. Demonetisation could drag down 2017-18 gross domestic product (GDP) growth to 5.8%, an Ambit Capital report on Friday said. The exemption on toll collection could result in cash flow constraints for road projects for interest payments at the end of the month, said K. Ramchand, managing director at IL&FS Transportation Networks Ltd (ITNL), which owns and operates multiple toll-based projects and collects an average of Rs1.7 crore in tolls every day. The cash flow impact would be serious wherever the revenue of road projects is linked to the repayment of loans, said Jayant Mhaiskar, managing director of MEP Infra Developers Ltd. “As far as the compensation is concerned, the concession agreements are fairly well-scripted or well-documented in terms of how the compensation is given,” he said. MEP Infra operates 30 toll plazas on national highways and has an average daily toll collection of about Rs4.5-5 crore. Mhaiskar said it is yet to be seen how traffic growth will be impacted. The government on Thursday extended the exemption on toll collection to all vehicles across national highways till 24 November to ensure smooth flow of traffic after withdrawing Rs500 and Rs1,000 notes on the evening of 8 November. To be sure, executives at least three road companies that Mint spoke said they have received some form of communication from the ministry of road transport and highways and the National Highways Authority of India (NHAI) assuring compensation. Under the concession agreement for road projects, companies need to apply for compensation against such losses under the change in law provision. The government could also compensate by extending the concession by a corresponding number of days. In case of cash compensation, anything less than 100% will be a negative for toll-based road projects, said Ashish Agarwal, director (infrastructure) at Equirus Capital Pvt. Ltd, an investment bank. “It is getting more clear that trade is going to be lower in the next quarter and traffic is in direct correlation to trade. Traffic in the third quarter would definitely get impacted,” he said. Road projects had seen a traffic growth of about 6% in fiscal 2016 and an equivalent growth in the first half of the current fiscal year, but this is likely to slow down in the second half, said Shubham Jain, vice-president at ratings agency Icra Ltd. Overall traffic growth at the end of the current fiscal may be just about 3%, he said. “More than the amount, as a rating agency, we are more concerned about the actual timing of the release of payments. Because toll road companies are operating at very thin cushion in terms of debt servicing and these companies have to make interest payments on a monthly basis, and debt repayments on monthly or quarterly basis,” Jain said. Even beyond this exemption period, overall toll revenue in this fiscal year may be lower than what the companies would have expected before 8 November, he said. Last week, Icra said in a report that loss of toll revenue for around 115 NHAI toll projects operated by private sector firms could be Rs460 crore for the 10-day period between 9 and 18 November. Other industry estimates suggest a toll revenue loss of Rs55 crore per day for NHAI’s projects. “ICRA expects that the NHAI may opt for cash compensation, instead of extension of concession, considering the developers’ financial stress. Nevertheless, there is significant uncertainty regarding the quantum, mode and timing of such compensations,” the Icra report last week said. The government could reimburse companies for the loss of toll income calculated either on the basis of their October average or the average of first eight days of November, Ramchand of ITNL said. “The government could pay 75% immediately and the rest over time, but there is no formal decision on this,” he said. “NHAI has communicated that it will pay an interim amount to toll operators and will also compensate the remaining. It is not yet decided whether NHAI will compensate on the basis of October’s toll income or an average for first week of November,” said Vasistha Patel, executive director at Sadbhav Infrastructure Projects Ltd. NHAI chairman Raghav Chandra did not respond to an email sent on Friday seeking comment. India has the world’s second largest road network of about 4.8 million kilometres but national and state highways constitute a small percentage of that network. Josh Gorges Womens Jersey
Delhi-Meerut Expressway may be allowed: Expert panel tells NGT
The permission to NHAI to build a bridge and its approach roads across the river for the Delhi- Meerut Expressway should be allowed to help ease traffic congestion, an expert committee today told the National Green Tribunal. The Principal Committee, headed by Secretary of Ministry of Water Resources, told a bench headed by NGT Chairperson Justice Swatanter Kumar that the “project may be allowed” subject to fulfilling of certain conditions including increasing the cost of monitoring during construction phase of bridge by nearly Rs 2.5 crore. The committee, constituted by the NGT for implementation of ‘Maili se Nirmal Yamuna Revitalisation Project 2017’, has recommended that project proponent should save “as many trees” as possible and no wetland area on the floodplains should be disturbed during the construction phase. The Principal Committee also comprises Special Secretary of MoEF, Joint Secretary of Ministry of Water Resources, Delhi Chief Secretary, DDA, Delhi Jal Board, municipal corporations, Commissioner and others. Professors C R Babu, A K Gosain, Brij Gopal and A A Kazmi of IIT Roorkee are also members of the Principal Committee, which also said that strong iron marshes of 8 inch height should be erected along the proposed bridge to stop the public from throwing solid waste in the Yamuna. The matter is listed for next hearing on November 22. The submissions came in response to National Highways Authority of India’s (NHAI) plea seeking NGT’s nod for building of bridges and approach roads over Yamuna. In its plea, NHAI had said that currently the route between Delhi and Meerut (NH-58) had frequent jams causing lot of inconvenience to traffic between the two cities and the project will reduce the time of travel to 40-45 minutes from three hours at present. NHAI had moved NGT in view of a 2015 order saying that construction of “new barrages and roads, railway and metro bridges and embankments and bunds” should not be permitted. However, in exceptional cases, “a critical impact of their potential impact on flood aggravation and environmental clearances should be made mandatory,” it had said. The Delhi-Meerut Expressway will be built through public -private-partnership mode and slated to be operational by March 2018. The project starts from National Highway-2 at Ring Road in Delhi and ends at Meerut in Uttar Pradesh. Darren Woodson Authentic Jersey
India Infra funding needs Rs 8.6 lakh crore a year: Crisil
India’s infrastructure funding requirement is gargantuan as it needs Rs 8.6 lakh crore per annum, rating agency Crisil said today. “The funding requirement to build India’s infrastructure is gargantuan. Crisil estimates the need at Rs 43 lakh crore over the next 5 years, which translates into roughly Rs 8.6 lakh crore per year,” Crisil said in a statement. It said, 70 percent of the Rs 43 trillion will be required in just three sectors — power, transportation and urban infrastructure. In power, generation (thermal and renewable) will continue to account for the largest share of the investments, followed by transmission, whereas in the transportation sector, investments will be driven towards building national highways and state roads. It said, given the issues of asset-liability mismatches and group exposure regulations of the Reserve Bank of India, banks alone cannot fulfill the needs. Banks also need to raise large amounts of equity capital at a time when their profitability has diminished which, in turn, reduces their ability to raise capital through internal accrual, it added. Crisil said, “There is a strong need for innovative structures and credit enhancement mechanisms which reduce the risk in infrastructure projects and make them more palatable to investors.” The report highlighted some of innovations such as partial guarantees and future flow securitisation besides some sector-specific instruments such as Green Bonds for renewable energy, which, though nascent, is an emerging option. It said building infrastructure is a capital-intensive process with large initial costs and long gestation periods. Although banks have traditionally been the largest financiers, their increasing exposure to infrastructure projects poses the risk of asset-liability mismatches because the investment horizon is typically long, it said. “Crisil believes the corporate bond market is better placed to play an active role in funding given its long-term investment horizon. However, as bond investors are risk averse, credit enhancement mechanisms are essential to bridge the gap between their low risk appetite and the higher risk associated with infrastructure projects,” it said. Crisil said that it believed that almost three-fourth of investment (73 er cent) will be funded through debt, with banks remaining the largest source of finance (48 percent). Following the Reserve Bank of India’s (RBI) easing of norms, external commercial borrowings (ECBs) are expected to be another large source of funds (16.5 percent of debt) with nearly Rs 5.2 trillion expected to flow in through this route. The balance Rs 11.2 trillion (36 percent of debt) is expected to come through bond issuances, the report said. Gale Sayers Womens Jersey