Traffic projections fail to take into account ground realities

Traffic projections fail to take into account ground realities
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First Published: Thu, Feb 21 2008. 11 34 PM IST

Squeeze factor: More than 10 million vehicles were added to the nation’s roads in 2006-07, according to SIAM.
Squeeze factor: More than 10 million vehicles were added to the nation’s roads in 2006-07, according to SIAM.
Updated: Thu, Feb 21 2008. 11 34 PM IST
New Delhi: Failure to capture local factors and instead relying on a standardized traffic growth rate of 5-7.5% is being identified as the main reason why traffic projections in some of the showpiece projects have been completely off the mark.
Squeeze factor: More than 10 million vehicles were added to the nation’s roads in 2006-07, according to SIAM.
Analysts fear that this may not be isolated instances and will afflict other urban road transport projects as well.
It is not clear as to why the country’s highway regulator, the National Highways Authority of India, or NHAI, uses these standard assumptions in projecting traffic growth.
Consultants who prepare the detailed project reports ahead of the NHAI bidding out the road project maintain that they are directed by the regulator to stick to the standard assumptions. An NHAI official, who did not wish to be identified, denied these charges.
Some analysts say this is because of the objectives desired by NHAI. According to them, the regulator works out the viability of a project based on these conservative growth estimates. Instead, they say, NHAI should focus on the carrying capacity by using more realistic estimates keeping local issues in mind.
Typically, the regulator commissions an infrastructure consultant to assess current traffic and growth estimates, proposed alignment of the road and the required land, in a document called the detailed project report, or DPR, before inviting companies to assess and bid for the project. The width of the road is decided on the basis of the growth numbers. Companies interested in bidding then conduct their own research to study the financial viability of the project.
The errors in projecting traffic, at a time when vehicle ownership in the country in general and urban areas in particular is booming, result in severe congestion.
At the same time, unexpectedly high traffic is also proving lucrative for the private operators by way of higher than expected toll revenue. For example, higher than expected urban growth has been cited as one of the reasons for the long wait times at toll plazas on the expressway that connects the Capital to Gurgaon, Haryana.
Mint had earlier reported that barely 10 days after the expressway was opened on 23 January, traffic had already reached the level originally projected for 2013.
The project DPR had been prepared by RITES Ltd. The company’s managing director V.K. Agarwal could not be reached for comment.
More than 10 million vehicles—of which 1.3 million were passenger vehicles—were added in 2006-07 at an annual growth rate of 13%, according to a report from the Society of Indian Automobile Manufacturers (Siam). Currently, an estimated 28% of the country’s population lives in urban areas. By 2030, that number is expected to grow to 40% or nearly 590 million, according to a recent United Nations Population Fund report.
“In a road project awarded last year, the concessionaire offered a very large negative grant. Presumably, the private sector developer saw higher traffic numbers than NHAI forecast... In almost all the cases, NHAI prefers to take the money, i.e., accept the negative grant. So, in those cases you should expect to see congestion on the road, if the story that the private sector expected does emerge,” said Partha Mukhopadhyay, a principal consultant with think tank Centre for Policy Research.
“It’s very unidimensional,” said a consultant with a project management company who did not wish to be identified, referring to the current traffic estimation practice.
“Most people use standard algorithms, standard Excel worksheets. It doesn’t look at the growth story,” he said.
The consultant said traffic growth is assessed at 1.5-1.6 times the growth in the gross domestic product.
However, with the rapid growth in India’s vehicle ownership rates and population in urban areas, such a standard measure does not always accurately predict traffic growth.
The same NHAI official admitted that sometimes the projections made could go wrong. “There have been cases wherein a particular place witnessed a sudden spurt in economic growth which was totally unexpected. In such situations, the projections may go wrong but that happens very rarely.”
A Planning Commission official, who did not wish to be quoted, said NHAI had a standard system of traffic projection at either 5% or 7.5% compounded annual growth rate.
Some concessionaires, however, argue that traffic numbers projections were used more for assessing the financial viability of the project.
“The government normally would take a 5% growth rate number to say that the road is viable at this growth rate. Then, we do our own assessment, saying if its viable at 5%; then it’s even more viable at 10%,” said the chief executive officer for a private road development company, who did not wish to be identified because he was competing for government projects.
rahul.c@livemint.com
Ravi Krishnan contributed to this story.
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First Published: Thu, Feb 21 2008. 11 34 PM IST
More Topics: Traffic | Population | Vehicle | NHAI | Transport |