MPs put skids on PM’s rural track

What is hampering work progress is not any fund constraint — multilateral agencies like the Asian Development Bank and the World Bank have agreed to lend about Rs 5,000 crore. It is the politicians, mainly Members of Parliament, whose personal demands are holding up the project.

Under the scheme, MPs have been given a role in identifying roads that would best serve the community. But ‘‘in several cases, the proposals of the honourable Members of Parliament pertain to the upgradation of roads which occupies (sic) a lower order of priority and hence could not be included in the current year’s (2001-02) proposals,’’ says the document.

The MPs and members of state legislatures are putting in requests for inclusion of their home roads in the project even when their cavalcade is the only one to hit that dirt track, say sources. And just like MPLAD, they want their favourite contractor to get the job of laying the road.

The two factors are messing up the road economics, which the ADB wants the Centre to address. Though the ADB has agreed ‘‘in principle’’ to lend Rs 2,500 crore, it wants objective criteria to be used in selecting the roads and appointing contractors.

ADB’s demand is that all projects be evaluated in such a way that a proxy or shadow economic rate of return is worked out. It is willing to take on projects whose ERR is about 8 per cent, below the acceptable economically viable ERR of 12 per cent, provided the road promotes rural economy in terms of linking it to nearest commodities market, industry or bazaar and encourages traffic movement.

On the contract front, it wants that all works should be grouped together in lots of Rs 5 crore and awarded to a respectable contractor to ensure quality control while achieving economy of scale.

But that shift in focus is being resisted by the politicians, thereby blocking external aid, which could start from May this year.

The result: Vajpayee’s budget team has so far managed to provide Rs 7,500 crore in three years and has to provide the balance Rs 52,500 crore in the remaining four years. Given the progress, it is highly unlikely that the PM would be able to achieve his dream of connecting 1.60 lakh villages with 500 or more residents by end-2007.

‘‘The attainment of target and making additional allocations would depend upon budgetary provisions made available and the progress of works in the states,’’ admits the document.

With the diesel cess of 50 paise per litre being the only funding source so far for PMGSY, the alternative before Vajpayee to keep his colleagues happy is to shift the burden on to the public through another hike.