Updated: July 3, 2014 11:04:14 am
MMRDA Commissioner UPS Madan at an Idea Exchange moderated by Principal Correspondent Manasi Phadke says the PPP model needs a re-look overall, and the agency will appeal against the Bombay High Court order on the Metro fare issue.
SAGNIK CHOWDHURY: What are the lessons you would take for future public-private partnership (PPP) projects considering the controversy surrounding the Metro fare hike?
PPPs in India have largely been unsuccessful. In Metro, this problem was because of the unique structure of the PPP. This PPP was on the BOOT (Build, Own, Operate, Transfer) system rather than the BOT (Build, Operate, Transport) system, which is widely used. Unfortunately, the change of law from Tramways Act to Metro Act that took place mid-way changed the rules of the game.
At present, the government is not keen on going for a PPP model in the Metro or public transport projects. We need to look at the PPP model itself. Dispute resolution is one of the biggest problems that we face. We had suggest to the Union government that there needs to be a dispute redressal machinery. We need to modify our agreement clauses and bid conditions, so that these problems do not arise.
SHUBHANGI KHAPRE: Was there no serious political will in the Metro project, especially with regards to the revision of cost estimates?
That is not true. No one revised the cost estimates. There is no reason to be lenient or not being authoritative. Authority comes with the agreement terms and conditions. As a government, you can go out of the way and bulldoze someone. But legally, you can only do what the agreement allows you. Ultimately, we have left it for the courts to decide.
MANASI PHADKE: Will you appeal against the Bombay High Court order on the Metro fare issue?
Yes, we will make an appeal before a division bench.
SHUBHRA TANDON: In several projects, private parties say the government needs to be made more accountable. They say there were delays in clearances, the maps were not in place, etc. What is your take on it?
If the terms and conditions of the bid document or agreement state that if there are delays, then these shall be taken into account and the benefit shall be given to the private party. But if the terms are silent or they are there but you cannot determine whether the delay was on the part of the authority or private party, then who will decide?
At times, the delays and cost escalation are due to bad luck. You plan to construct something and anticipate it to cost Rs 100 crore, but when you go out for tendering it costs you Rs 150 crore. It is just how the market responds. It is nobody’s fault.
SHUBHANGI KHAPRE: Why do projects get stuck in disputes between agencies?
There is a multiplicity of agencies, which is a reality. For example, even to provide roads within the city, there are at least four agencies to do the same work. The BMC is legally and constitutionally supposed to provide roads within the city limits. The Mumbai Metropolitan Region Development Authority (MMRDA) also has a parallel jurisdiction.
The Maharashtra State Road Development Corporation (MSRDC) has been set up to construct roads throughout the state. PWD is another agency. Projects are stuck due to the multiplicity of agencies, and political, administrative and financial factors.
SHALINI NAIR: Why did the rental housing scheme fail in its intended purpose to stem slum proliferation and create 5 lakh rental units in 5 years?
Conceptually it was a good scheme, but we faced issues when we took it forward. Providing infrastructure – roads, sewerage system and water – at a remote area is a challenge and is expensive on a per capita basis. Other issues were who will manage rental housing, allotment of houses, ensure rent is paid and evict people, if needed. The size of the house was yet another issue. Therefore, now the government has decided to shift from rental housing to affordable housing with lower density.
The FSI has been reduced from 4 to 3, the size of tenements has increased so in the same space you have fewer houses, making its management easier. We are also looking at areas within the jurisdiction of urban local bodies or closer to them so that the management of infrastructure is easier.
MANASI PHADKE: About 40,000 families have been rehabilitated while undertaking infrastructure projects. But the kind of houses they now live in are in poor conditions with leakages, non-functional elevators and choked drains. Why is that so?
There are issues with regard to supervision of under-construction sites. What is anticipated is not often the final product. The condition worsens after occupants move in. There may be a lack of ownership because it is free housing. Also, because the houses are for free, several occupants feel that even maintenance should be free.
We have prepared a scheme, exit plan, under which we spend large amount of funds to fix any inadequacies, post which residents have to form cooperative societies and take over. We have a budgetary allocation of over Rs 90 crore for the exit plan.
SHALINI NAIR: There was a time when the MMRDA was known for its record land sales. In the last five years, there has not been any sale. Does it have anything to do with the current market conditions?
At present, there is no need to dispose off any land. As and when we take up new projects or we require funds, we will have to sell plots. Market conditions is a parameter that needs to be looked at. If the market is very good today, I might dispose off a part of my property and keep the money, but if the market is down and I don’t need funds, there is no point in selling my stock.
PRIYAL DAVE:When we look at commuters across the various means of transport, ticketing is a major issue. Are you looking at integrated ticketing?
There are several passholders in BEST and railways. As of now, very few cards have been issued for Metro and monorail. We will gradually have a larger number of people using those cards. Initially, the individual card systems have to be established and then the integration among all these different systems will take place.
We had planned our own integrated system and had engaged an agency, but then the Union government insisted that their system be followed.
SHUBHRA TANDON: What is the status of the various projects like the Metro and MTHL?
Colaba-Bandra-Seepz Metro is now being implemented. We have already invited RFQs. It will take seven years because it is a fairly long corridor of 33.5 km underground. Next in line are two big Metro projects — Charkop-Mankhurd line, which will be underground and extended up to Dahisar, and Wadala-Thane-Kasarvadavali line. About 25 kms of the 30-km route will be underground and about five kms on the north of it will be elevated. These three projects, which are in the range of Rs 25,000 crore, will be implemented over the next eight to ten years.
The proposal for MTHL is already with the central government for the approval of a loan from JICA. CIDCO has shown its intent to be equal partners. There is also intent from JNPT. We will take a call as and when we are in a position to implement the project. For the Multi-Modal Corridor, we are in the process of acquiring land. The new Land Acquisition Act has dampened our spirits a bit.
SAGNIK CHOWDHURY: Having all your bases covered and then set the project rolling, is that the way to go in future?
The ideal situation is that you have all possible permissions taken and complete road map chalked out, then you award the work to an agency and start. But in a brownfield project, where there are congested and thickly-populated areas, you have to do some parallel activities.
For example for Eastern Freeway, if we had waited for all clearances, CRZ clearance, approval to work on salt plan land, clearing all slums and shifting all religious places. We would have had to wait for another ten years. When you start work, there is pressure on all these people.
(Transcribed by Manasi Phadke)
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