UP hampers Nath’s plan to cut red tape

UP hampers Nath’s plan to cut red tape

New Delhi: In a move that could affect highways minister Kamal Nath’s hopes of hastening road projects, Uttar Pradesh (UP) has refused to sign an umbrella state support agreement (SSA), which the Union government proposed last year to reduce paperwork.

SSAs are legal documents that assure highway developers or the Central government that the state will offer support in matters such as land acquisition and security.

UP’s refusal is part of a wider conflict with the Central government, with an official of the state government saying it decided against the umbrella arrangement because the Centre did not honour a promise that the state would be allowed to redevelop some neglected national highways.

“We had consented to an umbrella SSA. At the same time, we had agreed that they would allow us to take up national highways in the state that were pending for three-four years," said Uttar Pradesh chief secretary Atul Gupta.

Gupta said the Union government initially agreed to his state’s proposal but then “suddenly withdrew". “So we have decided that rather than having an umbrella SSA, we will work on a case-to-case basis."

Gujarat is the only other state not to have signed the umbrella agreement so far, said a senior highway ministry official who did not want to be named. A Gujarat state official, who also did not want to be named, said while the state had no objections to SSA, there were some issues that had to be resolved.

UP favours a model of road development in which the private sector developer finances and builds the highway in exchange for large tracts of land that can be commercially developed. The National Highways Authority of India (NHAI), which is tasked with administering most of the country’s 66,000km national highway network, only allows developers to generate revenue from tolls.

At a recent conference in New Delhi on infrastructure development, Gupta pointed out that the national highways would act as competing facilities to the state’s own highway development plans.

Around 8% of the nation’s highways run through UP.

The state awarded the 1,047km Ganga Expressway, connecting Ballia in the state’s eastern border to Noida on the outskirts of New Delhi to the Jaypee Group. At least five other expressways are also being planned by the state.

An NHAI official said UP chief minister Mayawati was using the threat of withdrawing from the SSA as a way of getting the Centre to stop building what she saw as facilities competing with her own expressway plans. “Otherwise, who would say no to Central funds," the official said on condition of anonymity.

“The states will lose out in the long run (if they don’t sign the agreement) because although you may have a couple of expressways, you will always need a network of highways," said Amrit Pandurangi of consulting firm PricewaterhouseCoopers.