Citizens' Issues
Here is what will come in the way of Modi to hit his infrastructure targets

The Prime Minister is set to announce highly ambitious targets for power, road, coal etc. Will he succeed?


Prime minister Narendra Modi would review performance of all ministries related with infrastructure in first week of September, say media reports. During the review meeting, the union government is also set to revise targets for nine infrastructure ministries, power, road transport, shipping, civil aviation, coal, petroleum, railways, telecom and renewable energy.


Last month, the PM met with secretaries of these ministries to review targets of each ministry. During the meeting, Sindhushree Khullar, secretary of Planning Commission, made a 15-page presentation on performance of core infrastructure ministries during 2013-14 and the targets for FY15. According to CNBC TV18, Modi has fixed ambitious targets for each of the sectors. Are these targets feasible? What are the impediments to achieving them?


Coal production: 562mt vs 463mt of last year. Target: 21.4%+


Against the target of 483 million tonnes (mt), the coal production in India actually reached only 463 million tonnes last year. Part of it was attributed to the cyclone Phalin and the monsoon flooding. Progress has been hampered by land acquisition problems and dealing with environmental clearances and so, the chances of reaching a target of 562 million tonnes seems remote.


State-run Coal India Ltd (CIL), the world's largest coal miner, sits on the world's third largest estimated reserves of coal, in the region of some 250 billion tonnes and yet fell 20mt short of its mining target of 482mt in 2013-14. Coal India directly controls, as a holding company, seven collieries and produces 85% of the fuel mined in the country.

According to media reports, over 60,000 mining clearances are pending with various State Governments. Karnataka heads the list with 19,497, followed by Rajasthan at 13.893, erstwhile Andhra Pradesh 7,691, Madhya Pradesh 4,680, Gujarat at 4,517, and Jharkhand at 4,409. Indian mines need to be modernised too.


Narendra Singh Tomar, Minister of Mines, Steel and Labour therefore, faces the enormous task of clearing all these 63,395 mineral concession applications which are pending with various State Governments. In sorting out the mess, several ministries are involved. How can the Government go about doing this huge task?


Rural Electrification: FY15 15,000 villages against 12,468. Up 20%


During FY15, the government plans to cover 15,000 more villages under the Rajiv Gandhi Grameen Vidyutikaran Yojana (RGGVY) project. This is an increase of about 20% compared with last year's coverage of 12,468 villages. How easy is this? Given that the government is cash-strapped, it remains to be seen how this would be achieved.


Road project target for FY15 8,500kms against 3169kms. Up 67%


This is one of the most ambitious targets of the Modi government. During FY15, the union government is planning to award projects of 8,500kms of road length. Last year, road projects for only 3,169kms were awarded as against a target of 9,683kms. The main reason was lukewarm response from bidders, problems of land acquisition and failure of public-private partnership (PPP) mode during 2012-13 and 2013-14.


During 2013-14, National Highways Authority of India (NHAI) had awarded 17 projects for a total length of 1,435.84kms of which two projects are on PPP mode. About 21 projects were bid out by NHAI through PPP mode, but none of the projects received any response.


Minister for Road Transport, Highways and Shipping Nitin Gadkari has said that he is trying to take forward road construction projects worth over Rs1.80 lakh crore rupees that are now being stalled by removing various hurdles. Gadkari said there have been huge Non-performing Assets (NPAs) in the banks relating to such road projects amounting nearly to Rs2.40 lakh crore. So, where will the new funding come from, to even complete stalled projects?


In all, the Modi government has set very ambitious targets for the infrastructure sector. Unfortunately, the government can no longer do it. It has no money, no expertise and no accountability. Who will do it, then? The sector is full of debt-laden businesses, run by crony capitalists. Public sector banks are weighed down by bad loans given to infrastructure companies. Where will Modi find additional money to pour into infrastructure? That apart, the rules set by the earlier regime that have hobbled infrastructure companies remain. There have to be fundamental changes in law, bidding process, monitoring and so on. Unless such changes happen, targets set from the ramparts of Red Fort will mean nothing.




3 years ago

Agree, there is a huge lack of competence and resources in the Indian infrastructure sector which is known all over the world.

The methods are simple - PPP projects inflate the project cost by 3-4x, obtain debt from the banks, and pocket the money. The quality of work is so pathetic that projects that last 50+ yrs in other countries do not last even 5 yrs. When things become really bad, user charges are hiked by an accommodating minister, and some small improvements are made.

There is a way out - Modi should prosecute these crony capitalists and their friend politicians, attach their properties to recover part of the money pocketed, and use it to take a 25% stake in fresh projects, to be owned and operated by a select list of globally reputed companies on Build Own Operate Transfer basis as practiced by several Middle East countries.

At the end of 5-7 yrs (not longer) the govt should buy back the foreign companies stake at depreciated cost & only contract out the operations.

The private ownership of pu8blic assets has only created higher prices, crony capitalism & poor quality of service. Clearly, indian companies do not have it in them to be allowed to own monopoly assets and maintain standards.

The practice can be reviewed 10 yrs later, when some mature and business-like indian groups emerge. The first flush of andhrapreneurs that thrived only on political patronage & wrongdoing should close down by then

Abhishek Chandra

3 years ago

The author says that the Modi government has no expertise, and I disagree entirely. While Modi has had considerable experience in running Gujarat, there are plenty of national level leaders in the NDA as well.

Please spare me the "India is not Gujarat". I would like to point out that Gujarat is India, and Modi literally modified Gujarat.


3 years ago

The main problem for Infrastucture and Industrialisation is Land Aquisition. The various Industrial Belts like Thane Belapur Road, Pimpri-Chinchawad, Khopli and numerous others, developed because the Government procured the Land for Industries/Industrial Estates,provided Electricity, water and Road connections and offered such readymade plots for setting up Industry. Today if the Navi Mumbai airport project is held up because of Land Aquisition (Farmers demanding totally exorbitant prices) one can imagine the plight and future of the Private Parties trying to procure land for their Projects.


3 years ago

India managed to create a 350 million strong middle class from mostly poor, undereducated families, with govt. and philanthropist subsidized education while facing huge problems: colonization and the resulting illiteracy, poverty, food shortage, regular US supply of free arms to Pakistan, etc.

India's only internal problem is its huge overpopulation and the solution has to come from citizens.

Anyone who aspires to be well-off should not have children, unless s/he has the wherewithal to support them nicely. A child's rights come first, not some silly wish to propagate your name or think it is a duty (!) to breed. In any case, the world is packed with unwanted kids, why produce more?

Everyone's duty is to NOT breed unless you really want kids, at least one of you is prepared to be there full time for raising them and ample resources, both human and material.

Poor people do NOT have the right to bring children into horrific misery and destitution.

Reduce India's population and watch progress, a reduction in scarcity and hence corruption. deal with today but plan intelligently for the nation's future.


Praveen Sakhuja

In Reply to bharati 3 years ago

Bharti I agree with U first we should supporting devices then think of other aspects. Still India has population which has sex as an entertainment but results in increase in population leaving the born to starvation [see our roads flooded with beggars. This problem can only be over come with the efforts of government machinery which is located in every corner of country.


3 years ago

If someone credits everything to that happened in Gujarat to NaMo, is difficult to agree. Gujarat has been a rich state and people are industrious, so it was easier for him to carry out one man show. But India is not Gujarat, it is beyond Gujarat.


Praveen Sakhuja

In Reply to ALEX JACOB DMELLO 3 years ago

Alex is right in saying India is not Gujrat, It is small part of India. I had once suggested to PM that he should educate his team to shun out using Gujrat and Modi sarkar in every sentence being uttered. Instead they say other state (s)[similar to gujrat] and our sarkar. It may pinch few for that pardon me.


In Reply to ALEX JACOB DMELLO 3 years ago

So presumably Gujarat was doing just as well and had ample access to power, fertilisers, storage facilities, etc. ? Of course not. You may dislike someone's religion, but no harm in giving due credit.

Bharat parikh

3 years ago

IF Namo can't do that then who else can do that, He already proved himself in Gujarat against all odds so let us give him time.
So shradha & saburi is the Key for achhe Din ane wale hai
Jai Bharat

Praveen Sakhuja

3 years ago

Modi can achieve the targets set to be achieved in every field provided his team supports with every inch of their heart. Selfish partners will pull all hindrances for achieving the targets.

Rakesh Goyal

3 years ago

Set a target and achieve it - is success.

Set a a target and exceed it - is excellence.

Set a target and do not achieve it even by 1% is failure.

All these targets can be achieved only if there is competence, motivation and honesty. Mere intentions do not produce results.

Paul dmello

3 years ago

It is great to hike project expectations but same needs Tao be balanced with funds at hand and capacity to make extra funds available. Also need Tao weed out corruptions which siphon funds away.

Madhur Aggarwal

3 years ago

Moneylife keep it that way.
Liked the article.

State the Ground realities as they are.

We need news and journalism of depth and realism , away from high claims of these political parties,

Main Q in India of 2014- Will BJP deliver ?

This news confirmed that
BJP - Achche Din seems less implemntation on ground .
Collision course for Indian people .
Netao ka kya jaaega ????



In Reply to Madhur Aggarwal 3 years ago

A democracy succeeds only if its PEOPLE cooperate, sacrifice where needed and work to ensure progress.

DGCA starts probe into 5,000 feet plunge by Jet Airways flight

Jet Airways' Boeing 777—300, operating flight 9W—228 from Mumbai to Brussels and onwards to Newark, plunged to 29,000 feet from 34,000 feet while traversing on the busy air route to Europe last week


In a major scare, a Jet Airways flight from Mumbai to Brussels, carrying around 280 passengers, plunged 5,000 feet while overflying Turkish airspace last week as the commander was asleep and the co-pilot busy with the iPad containing flight information.


Terming it as a “serious incident”, India's aviation regulator Director General of Civil Aviation (DGCA) has suspended the two pilots and initiated a probe into the incident.


It has also set up a three-member team to review the airline’s flight training programmes and facilities following the incident last Friday, official sources said, adding the team has been asked to submit their report by 31st August.


DGCA has directed the airline to come forward with all related reports, as well as the records of the Digital Flight Data Recorder (DFDR) within this week, they said.


The incident occurred when the Boeing 777—300, operating flight 9W—228 from Mumbai to Brussels and onwards to Newark, plunged from 34,000 feet to 29,000 feet, while traversing on the busy air route to Europe.


As the aircraft descended, the air traffic control at Ankara sent an emergency message to the aircraft asking the pilots why they had deviated from the assigned flight path and directed them to climb up to the designated height immediately.


Both pilots were summoned by DGCA on Wednesday for questioning.


While the commander said he was on “controlled rest”, implying a short nap inside the cockpit, which is allowed by flight operation procedures, the co-pilot told the regulator that she was working on her iPad or the electronic flight bag which has all aircraft documents loaded on to it, the sources said.


Immediately after the Ankara ATC message, the co-pilot woke up the commander who restored the height of the plane.


Confirming the incident, an airline spokesperson said Jet Airways has initiated an internal inquiry into the matter.


“The airline is also extending all co—operation in the matter to the DGCA by providing all necessary assistance for the inquiry. Safety is of paramount importance to Jet Airways as is also the welfare of our guests and crew and the airline will always take appropriate steps to ensure the same,” the spokesperson said.


New formula for natural gas pricing by 30th September

The Modi government decided to review the pricing formula keeping in mind public interest and recommendations of the Parliamentary Standing Committee, oil minister Pradhan said


The Indian government on Wednesday said it will come out with a new natural gas pricing formula by 30th September keeping in mind the interest of investors and public.


Replying to questions in Rajya Sabha, Oil Minister Dharmendra Pradhan said the National Democratic Alliance (NDA) government decided to review the pricing formula keeping in mind public interest and recommendations of the Parliamentary Standing Committee.


The Minister did not share details, but said the decision will be taken keeping in mind interest of investors and public and the formula will be announced by 30th September.


The previous United Progressive Alliance (UPA) government had in December last year decided to price all domestic gas from 1 April 2014 according to a formula suggested by the Rangarajan Committee.


The formula was notified on 10th January but before a new rate could be announced, general elections were declared and the issue was left for the new government to decide.


The new government on 25th June decided to defer the implementation till September-end to hold wider consultations.


The existing gas pricing under new exploration licensing policy (NELP) was approved in 2007 and was to remain valid up to March 2014.


For reviewing the formula, the government constituted a committee under C Rangarajan in May 2012 and based on the panel's recommendation, Domestic Natural Gas Pricing Guidelines, 2014 was notified in January this year.


The Rangarajan formula would lead to doubling of natural gas prices to $8.4 per million British thermal unit, an increase that would jack up urea production cost, electricity tariff and CNG rates.


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