On the road from Make to Move in India
Nitin Gadkari is among one of the Narendra Modi led government's biggest assets and has undoubtedly shaken things up as the minister for road transport, highways and shipping. He takes some valuable time out of his incessant schedule for 'India Investment Journal' to take stock of where things stand in terms of his enormous infrastructure challenge. How do you see your vision on ports and roads translating into milestones for the Make in India and Smart Cities programme One of the biggest enablers for the 'Make in India' program is how efficiently freight can 'Move in India'. In both our ministries, the primary objective has been to reduce the logistics cost. As far as the smart city program is concerned, we are planning to contribute to it by building smart cities in our 12 major ports. How do you see your ministry's innovative approach and financing models producing results on the ground When our government came into power, the road sector was in a bad shape. Most of the PPP (public-private-partnership) projects were languishing and the private sector willingness to invest in the sector was low. We had to innovate to bring in private sector investment. The Hybrid Annuity Model is one step in that direction. The model so far has received very good response from the market. We are trying to introduce new models like TOT (toll-operate-transfer) to attract more private sector investment. What are some steps taken to overcome the challenge of NPAs (non-performing assets) We have taken several steps to de-risk the road projects. We are closely working with the banks to infuse liquidity in the sector and complete most of the ongoing projects. We have also taken certain policy decisions that have improved the viability of langushing projects, including extending the concession period for delays not attributable to the concessionaire. Please elaborate on the progress of the government's approach to attract international funds. The government is keen on improving the equity base of the private sector in the infrastructure space. Infrastructure offers the best investment opportunity for patient capital. The government has been creating new instruments to offer various opportunites for investors. Infrastrucutre is one of the sectors were FDI is allowed 100 per cent.
How do you see the role of SPVs in tying in local regional development needs to wider central projects such as Clean Ganga PPP has been a very successful model in bringing in private sector efficiency in government run infrastructure programs. The cost, time and quality efficiency brought by PPP has helped the government in effectively using tax-payer money for developing infrastructure. SPV (special purpose vehicle) is an instrument for the PPP model and the government plans to use it wherever it is the right model to adopt for implementation. What are some of your highlight plans on infrastructure in the coming months Are there still some bottlenecks to their fruition We are driving the ambitious Sagarmala program through our shipping ministry. The program will help us use our waterways effectively to lower the logistics cost for both domestic and EXIM trade. The advantage of Sagarmala is to bridge the infrastructure deficit with minimal investment. What are some personal targets you have set yourself in terms of infrastructure building We have set ambitious targets in both our ministries. We are trying to build over 10,000km of roads this financial year. We are planning to build five new ports in a span of five years. There are several challenges in achieving the same and I am confident that we as a team would be able to overcome them and achieve the targets we have set for ourself. What are the top three things that you feel would make your task at hand easier Quick decision making, quality of project preparation and acceptance of new technology and innovation are the top three levers to build infrastructure on a large scale. I am hopeful the initiatives we are taking in this direction will bear fruit and increase the pace of infrastructure development. What are some of your most fulfilling achievements as head of this department so far The attention neglected inland waterways and coastal shipping is getting now has been very satisfying. These are the most cost-effective and eco-friendly modes of transport. Their promotion is very essential as India grows into a large economy.