In an interview with Reuters, Nitin Gadkari, India's transport minister, promised to increase India's contribution to economic growth by two percentage points within two years. India's economy has a lot of room to grow, but it is constrained by a large number of land and environmental disputes. More than $9 billion in road projects are on hold for the first time, Gadkari told Reuters. Although the government has failed to pass national legislation to make it easier for investors to trade land, land acquisition will not be difficult for infrastructure projects. He said that by March 2016, the speed of road construction will exceed 30 km per day, and in the next three years, 7.5 billion US dollars of infrastructure projects are planned to be completed.
At present, once the project is approved, public bidding can only be held once, and the willingness of enterprises to invest in highway construction will be greatly increased. "We have released 17 mixed investment road projects, some of which we plan to implement EPC mode (design, procurement, construction)," Gadkari said. Within 15 days, we will place an order for the Eastern Expressway, and the 700 billion rupees ( $1 billion) project will start. Meanwhile, within 15 days, we will receive the tender documents for the New Delhi-Milat Expressway project, which is planned to invest 1 trillion rupees ( $1.5 billion) and will start construction within a month.
"Last year, we only successfully implemented three PPP projects, but since March this year, we have implemented nine PPP projects, and by the end of this year, I expect to reach another 25 PPP projects," Gadkari said. This is the first time in nearly 7 years that the PPP model has received such a good social response.
"We decided to build all the roads with cement concrete," he added. "When we made this decision, cement companies raised the selling price of cement to Rs 300-350/bag. We have set up a platform to supply 9.5 million tons of cement at a price of 120-140 rupees per bag (cash transaction) including tax and freight, and 37 cement enterprises from 108 cement factories are currently selling cement through this platform. We are also considering building a similar platform to supply steel and other materials needed for highway construction.
If the progress of infrastructure construction projects in India meets Gadkari's expectations, it will undoubtedly be a major positive news for the cement industry in India.
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