The Minister for Road Transport and Highways, Shri Kamal Nath has assured the investors that their concerns about certain irritant clauses in the Model Concession Agreement (MCA) and Request For Qualification (RFQ) document would be resolved by the end of this month. The Minister also announced that the Government is looking at the feasibility of taking up a few mega projects - 500 Km in length and with a total project cost of more than a billion US$ each. The Minister was addressing the Road Show, “Building India: Road Infrastructure Summit” jointly organised by CII, ICICI Securities, JM Financials, Confederation of British Industries and Commonwealth Business Council at London on Tuesday.
Interacting with the participants at the summit, Shri Nath hinted at smoother and investor friendly processes, and informed them that the concerns with regard to MCA related to termination clause, exit clause, conflict of interest and definition of the associates, earlier raised by various stakeholders, are under consideration at the highest level of the Government and shall be resolved very soon. The Minister also assured them that other issues of concern like determination of realistic total project cost, faster dispute resolution mechanism, longer concession periods and change in Companies Law to make Special Purpose Vehicles (SPVs) more attractive, are being examined and soon a satisfactory resolution will be worked out.
Speaking at the Road Show, the Minister stressed on the potential of the road sector in the country and presented the blue print of the development of the road sector to the investors. He said that the Government has set a target of building 7000 km of roads per year, and would require an investment of about 70 billion US$ in the next 3-4 years. He said, Public Private Partnership would play an important role in the programme, as about 60% of the projects will be taken up on BOT mode and an investment of about 45 billon US$ is expected from the private sector. He urged the investors to be a part of India’s infrastructure revolution as with the 11% estimated growth in transport sector, traffic on Indian roads is bound to increase much more than estimated.
Later, at a luncheon meeting with CEOs and Heads of prominent Investment companies, the Minister had a free exchange of ideas. At the meeting, the investors highlighted their concerns with regard to timely completion of land acquisition, finance and viability related issues, environmental and safety issues, as also the need for an independent regulator. Shri Nath assured action on all the fronts.
The Minister also had a meeting with Lord Andrew Adonas, Transport Secretary, UK on Tuesday. Both the Ministers exchanged views on development of roads and road transport issues of common interest including licensing, fitness, and emission norms of transport vehicles. It was agreed that there is a need for more co-operation between both the countries in the sector. To further this, a draft Memorandum of Understanding will be prepared. It was decided that a delegation of officials from the Ministry of Road Transport and Highways and other related organisation will visit UK for further discussions to finalize the MoU.
Shri Nath also participated in the Indian Highways Infrastructure Round table organized by CII-UKIBC today
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