New Delhi: Major infrastructure projects in power, coal mining, petroleum and natural gas, roads and railways have missed targets set for April to December, a report said.
The ministry of statistics and planning’s review report on infrastructure released last week showed all segments except refinery production trailed targets.
Highways regulator National Highway Authority of India, or NHAI, missed the target of widening, strengthening 2,261km of roads by 30%. Natural gas output was short of the goal of 30,019 million cu. m by 5,017; fertilizer production was 10% below the target at 11.15 million tonnes (mt).
Only refinery production topped its target by 1% at 120.4mt, led by projects undertaken by state-owned Indian Oil Corp. Ltd, the report said.
Movement of goods also saw a lower-than-expected traffic during the period. Railway freight at 607mt was 3.4% below target and major ports handled 392mt of cargo, 8.1% short of the goal.
An August review by the same ministry had reported similar findings. For the five months to August, most sectors, barring refinery production, had failed to meet targets. Mint had reported on 13 August that at least half the infrastructure projects being executed in vital areas—such as atomic energy, railways, power, telecom and petroleum—have been delayed, resulting in a cost overrun of at least 10%.
Some officials say missing targets can’t always be seen as nonperformance. “While the road sector missed its target, it will be wrong to say that NHAI is not performing. By the same statistics, NHAI has recorded a 72% growth compared with April-December 2007,” said a Planning Commission official who didn’t want to be identified.
NHAI added 656km of roads in the nine-month period compared with a year earlier. Total expenditure on highway projects in the period under review rose 13.4% from a year ago.
Infrastructure has been a major focus for the Congress party led-United Progressive Alliance government, as it attempts to boost public expenditure following the global economic slowdown. Starting December, the government announced two major stimulus packages worth about Rs52,000 crore. A bank refinance window of Rs40,000 crore through state-owned India Infrastructure Finance Co. Ltd has also been provided for.
Private sector investment is a major component of this government’s infrastructure financing plan, with the Planning Commission estimating that at least 30% of the projected $500 billion in infrastructure investment between 2007 and 2012 should come from the private sector.
“There are no bids (from private developers),” said Siddhartha Das, national public-private partnership practice leader at consulting firm Ernst and Young Pvt. Ltd. “It has only slowed down in the past one and a half years because of overconfidence in the institutional arrangement and in investor interest that was exacerbated by the economic slowdown.”