Quietly, UPA celebrates NDA reforms

The Survey gives the credit for the better performance to the scheme adopted by the government to leverage public funds through private partnership with three critical components:

• Releasing funds only when linked to specific milestones in physical completion

• Sharing risks with private promoters and financiers

• No open-ended guarantees from the government at any stage

But it is the real examples in the Economic Survey which could be lessons for the government and its critics — the National Highways model and the ports model.

The Survey points out that under the National Highway Development Programme, (NHDP) 13,146 km of National Highways will be converted from 4-lane to 6-lane at an estimated cost of Rs 54,000 crore. Added to this is the initiative of the Golden Quadrilateral of 5,846 km connecting four major metros of Delhi, Mumbai, Kolkata and Chennai. Then there is the initiative of the North-South, East-West corridors, all major efforts which have become a reality thanks to the institutional changes in the way things have been done.

The Survey points out that the setting up of a specialised National Highways Authority (NHAI) instead of just a government department is what has made the real difference with the progress of projects.

While 3,200 km of roads under NHDP already completed, another 3,700 km is under implementation. The Survey states: ‘‘NHAI exploited a variety of contractual structures in moving towards public-private partnerships… projects costing over Rs 5,669 crore are being implemented through such contracts with Rs 2,354 crore under build-operate-transfer.’’

As for past performance, the Survey states: ‘‘Average turn-around time for ships in Indian ports dropped by 5.7 days in 1998-99 to 3.5 days in 2003-04… pre-berthing time at major ports dropped from 6.9 hours in 2002-03 to 5 hours in 2003-04.’’ Even output indicators showed a improvement.

The Survey also shows that greater foreign investment and FII inflows are needed for a China-like growth, and calls for de-reserving the small-scale sector to promote efficiencies and competition, better labour laws to bring in flexibilities to adapt to economic realities for businesses.