China’s Rs 9,125 crore plans for Indian roads hit speed breaker

India is likely to reject a proposal received from China to allow its firms to construct 9 highway projects here.

New Delhi | Published: September 22, 2014 4:47:26 pm

Less than a week into a successful visit by Chinese premier Xi Jinping to India, the Narendra Modi government is likely to reject a proposal received from the neighbouring country to allow its companies to finance and construct nine highway projects here.

Top government officials privy to the development said that the matter has already been discussed in the road transport and highways ministry, and it would soon communicate its views to the Chinese counterparts that investment under the model suggested by them would not be feasible.

China proposed to take up construction of 890 kms of highways (nine in number) worth Rs 9,125 crore that government planned to award under engineering construction and procurement (EPC) basis during Chinese president’s visit to the country. It proposed that Chinese firms would pick up these projects, finance its completely and also bring their own contractors for construction.

“It is practically impossible for the government to agree with such a proposal from China. Award of road projects in the country follow a process and everyone has to adhere to it,” said M Murali, director general, National Highway Builders Federation.

The government official quoted earlier said that the proposal presented by China was non-transparent model that will make it difficult to judge the total project cost of a highway stretch. “We want the Chinese to participate in bids like other developers and take the projects. Both EPC and Built Own and Transfer (BoT) models are based on competitive bidding,” the official added.

 

The nine projects identified by China for possible investments by its companies span across the country in states such as Punjab, Haryana, Odisha, Andhra Pradesh. These projects are yet to be bid and each stretch is worth Rs 1,000 crore.

The road ministry proposes to award 8,500 kms of stretch this fiscal. The nine projects are included under this category. Sources said that road ministry has already sent an email to the infrastructure department of China detailing the processes followed in the country. It has also sought financial structure of proposed investment being explored by China in the sector and also advised to route investment in BoT projects.

– Subhash Narayan | Financial Express

 

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