Indian economy needs far greater investment in infrastructure

Ireo Skyon, Gurgaon

The overall direction of the Kelkar report is unexceptionable and must be accepted by the government.

The government must accept that its fiscal situation is precarious, more so than the Budget numbers suggest, and take corrective action. In that, pruning non-merit subsidies must have priority.

The government must explore fully the revenue mobilisation avenues open to it: better collection of tax, sale of public enterprise shares to the public and sale of surplus land lying unutilised with assorted government departments and public enterprises.

All this is indisputably sound. And the government is already taking steps to implement this agenda. At the same time, there are some recommendations that bear closer scrutiny and there are some fiscal issues that the Kelkar panel has not gone into but deserve remedial attention.

Read more: The Economic Times

New UPA thrust on insurance, infrastructure

Unfazed by continuing opposition to recent reform initiatives such as allowing foreign direct investment (FDI) in retail and a diesel price hike to contain the fiscal deficit, the UPA government is preparing another round of big-ticket reforms. On the cards are a big push for infrastructure through a special fund and a fresh thrust to help foreign investors in insurance.

Prime Minister Manmohan Singh’s government is willing to walk the talk to cover lost ground through a rush of measures, which include a politically contentious move to raise the FDI stake ceiling in insurance companies to 49% from the current 26%.

India also is set to float a mega infrastructure debt fund (IDF) that will allow the government to dig deep into the pockets of households and institutional funds to raise resources to build highways and also test investor confidence in a slowing economy that has been the target of unsparing criticism from global credit rating firms.

Read more: Hindustan Times

East Delhi to get its first multilevel parking facility

Will have space for 500 vehicles

The parking woes of east Delhi residents are set to ease to some extent as the East Delhi Municipal Corporation is coming up with the first multilevel parking lot across the Yamuna at Babarpur.

While the civic body is in the process of appointing a consultant for the project, the four-storey parking is expected to have a capacity of 500 vehicles.

“The site identified for the multilevel parking is owned by the civic body. Currently, the land is being used as a maintenance store. A consultant for the project will be appointed soon,” said EDMC commissioner S S Yadav.

Officials say it is yet to be decided whether the project will be a fully automated one or ramp-based parking lot.

The project will be taken forward on a public-private partnership model.

“The final decision over the nature of the parking lot will be taken only after the consultant submits the final report. The consultant will have the mandate to suggest the nature of the parking lot as per the space available and needs of the area,” a senior corporation official said.

Read more: Deccan Herald

 Transportation

DGSCL delaying KMP expressway that could ease pressure on Delhi-gurgaon expressway- Toll Hatao Sangharsh Samiti

With the Delhi-Gurgaon Expressway perennially choked at peak hours, a citizen group protesting against the toll at Sirhaul believes that a possible  solution lies in the alternate route- the Kundli-Maneser-Palwal(KMP) Expressway.

The ‘Toll Hatao Sangrash Samiti’ says that when developed, this expressway could ease pressure of the inter-state heavy vehicle traffic and smoothen  vehicular movement on the Gurgaon Expressway.

But the Delhi Gurgaon Super Connectivity Ltd(DGSCL) is deliberately delaying the project because the Delhi Gurgaon expressway is its huge source of earning, the group alleges. The 135.6-km-long KMP project of the Haryana government has also been awarded to DGSCL.

For the traffic coming from western states and headed towards northern and eastern states, both the expressways will meet at Manesar.

Read more: India Today

Delhi metro to get 8-car trains

Mr E. Sreedharan, Principal Advisor to Delhi Metro Rail Corporation .
Photo: Bijoy Ghosh

Delhi Metro Rail Corporation’s eight-coach metro train service will start in November. After successful trial runs for nearly four months until October, DMRC will introduce bigger trains on lines 2 and 3 that cover the Gurgaon-Jahangirpuri and Noida-Dwarka stretches, respectively, in November.

“Though, the date is yet to be finalised, the eight-coach train service will begin next month,” said Raj Kumar, director (operations) of DMRC. The trains are expected to make the lives of commuters easier on the two busy lines that together service about 1.4 million people daily.

Read more: Hindustan Times

Delhi Metro, a template for other metro projects: Sreedharan

If you need to be treated for some disease “You do not go to a L1 doctor, do you?” That was E. Sreedharan, Principal Advisor, Delhi Metro Rail Corporation, at a seminar, responding to a participant’s question relating to project management and limitations of working with the lowest bidder in public sector project.

Sreedharan said chief executives and senior managers in public sector companies have a lot of autonomy but do not always exercise initiative. There was never any rule that a project has to be handled by the lowest bidder.

It is essential that someone with the requisite capability to deliver the job on time and specifications.

Managers have the option to shortlist, pre-qualify bidders and then opt for L1 if they have to, he said.

Over 90 per cent of the decisions can be taken by the chief executive and only the rest need “to go to the boardroom”, he said sharing his experience of spearheading large public sector projects such as the Konkan Railway, Delhi Metro Rail and the Cochin Shipyard.

Read more: Business Line

For faster repair work, Airport Metro to try out alternative methods

A couple of “alternative” rail fastening systems will be tested on the structural damage-hit Airport Metro line, following the Union Urban Development Ministry’s suggestion to install them to avoid delaying repair work.

The system is a technique for fixing rails to concrete ties.

The authorities decided to carry out trials of the alternative fastening systems because the imported equipment, originally planned for installation to fix the damages to rail fastening clips in the underground section of the corridor, were held up at Customs.

Read more: Indian Express

Economy

New finance minister to focus on deficit, infrastructure

A day after his appointment as finance minister, NCP leader Jayant Patil on Sunday said his priority would be to reduce the state’s debt-to-GDP ratio without affecting the state’s development expenditure.

“Expediting infrastructure projects and reducing debt will be the priority of the finance department,” Patil told TOI. NCP leader Ajit Pawar as deputy chief minster and finance minister had presented a marginal revenue surplus budget with a focus on infrastructure and health. The state government is steadily pushing ahead with projects to boost transport (including roads and water transport) in Mumbai and other cities.

Read more: The Times of India

FDI

Will companies benefit from FDI?

Retail stocks have been partying on news of the Government permitting foreign direct investments in multi-brand retail. But what will the opening up of foreign investment bring to companies in the listed space?

While it may be early days yet, companies do stand to benefit in the long term in terms of back-end infrastructure and capital inflow. However, their challenge will be to work around the restrictions on location and build up economies of scale.

Type of retail

Foreign entities can invest up to 51 per cent in multi-product retail — retailing various products bearing different brand names under one roof.

Multi brand retail could refer to specific product segments such as electronics or furniture, or it could be the quintessential supermarket that bundles farm produce, groceries and household items under one roof.

It is this segment that will attract the most attention as it has the largest market potential in India. Indian retailers who do operate in this segment are Pantaloon Retail’s Big Bazaar, Trent (Star Bazaar), Shoppers Stop (HyperCITY), and CESC (Spencer’s Retail).

Read more: Business Line

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