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In an interaction with INFRASTRUCTURE TODAY, Devendra Kumar Sharma, Business Unit Head, Roads, Bridges & Ports, Tata Projects Ltd, highlights the things that would help achieve the government's ambitious road capacity addition target.
The government has announced a significant road capacity addition target of about 40 km/day. Considering the sluggish economy, how achievable is this?
Construction of roads and highways is critical to the nation's development. In recent years, there were certain impediments to the execution of road and highway projects, but there is a visible movement in bringing about changes and reasonable progress has been made. The government's intent to invest about Rs 1 trillion over five years for infrastructure development is an important measure that will provide a strong impetus to the road segment. Further, the Minister of Road Transport & Highways recently stated that the government is giving about Rs 900 billion as budgetary support to the National Highways Authority of India (NHAI). The bottlenecks are reducing, and the government's resolve remains firm. We, therefore, feel that the 40 km/day target is achievable.
Other than land acquisition and funding constraints, what are the other major hurdles in road development?
Land acquisition and funding were important issues for the road segment in the past, but now the government has intervened to resolve these issues. For example, the government is ensuring that at least 80 per cent of land acquisition along with utility shifting and environmental and forest clearances are done or received before any road project takes off.
What do you think would be the impact of the slowdown in the economy on the overall infrastructure and construction business?
The infrastructure sector, in general, and the construction segment, in particular, are extremely crucial in driving the economy because many allied industries indirectly benefit from such projects. The government's initiative to push investment in the infrastructure sector will help drive economic growth.
How good is the order book of Tata Projects till 2022?
Tata Projects' current order book stands tall at about Rs 500 billion. This is expected to grow substantially owing to a large number of infrastructure projects in the pipeline. The government is focused on upgrading and expansion of infrastructure across segments such as roads, bridges, metros, railways, power, oil & gas, buildings & industrial structures, smart cities and river rejuvenation. There is a need to invest about $200 billion every year. We remain highly optimistic about continuing to tap this market and building our business while contributing to nation-building and improving India's infrastructure.
Do you expect any stimulus from the government?
The Central Government had set up an inter-ministerial task force to chalk out an annual National Infrastructure Pipeline (NIP) for each of the next five years. It will commence this fiscal, 2019-20, and continue at least until the fiscal year 2024-25. Given the need to fuel growth and driving the infrastructure plan year after year, a stimulus is most likely.
Your take on the likely infrastructure and construction scene in the next three years?
India is a nation in the making and soon there will be enhanced focus on the expansion of existing infrastructure facilities as well as the creation of new amenities. With incomes rising across India, there will be demand for more and improved infrastructure facilities across all segments. Urbanisation is happening at a rapid pace in the country with a need to develop our cities to cater to the rapidly changing environment. According to various reports, more than 50 per cent of our population will be living in urban areas or cities by 2050. This will put tremendous pressure on the infrastructure of the cities to cater to the demands of the population. In turn, this presents huge opportunities for the construction segment.
- LIZA V