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Bridging the gap between today and tomorrow. (In pic: A railway bridge on the River Yamuna)
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Public private participation (PPP) has been emerging as a significant way of taking up infrastructure projects when it comes to funding. “In the current global scenario, India should continue to focus on the PPP modules, which will help standardise the pattern,” says Sethi. However, PPP may also have some drawbacks going ahead.

As per the new Model Concession Agreement (MCA), the selection criteria for PPP projects considers invitation of financial offers from a limited number of pre-qualified applicants (being around five) at the end of the Request for Qualification (RFQ) Stage. There is a fear that this would actually work in the favour of foreign players.

“The pre qualification norms have been eased but such a step may have a negative impact on many Indian firms as foreign companies are more likely to get an edge,” says Shrivastava.

With regards to PPP projects, Maytas has set a new example with the revenue model adopted for the Hyderabad Metro Rail project. As per this model, the Maytas Infra-led consortium has offered to build the project without taking any grant from the government and instead promised to pay back the government a substantial sum over the next 35 years.

“The model offered by us was so compelling and innovative that the Planning Commission took a note of it and plans to make it a benchmark for others to follow,” says Madhav.

The Andhra Pradesh chief minister Dr YS Rajasekhara Reddy too has appreciated the model, while the Prime Minister Manmohan Singh and Planning Commission vice-chairman Montek Singh Ahluwalia have urged other states to follow suit. James S Simpson, administrator of the Federal Transit Administration (US) has described the model adopted for the Hyderabad Metro rail project as one of the world’s best and largest.

Historically, India has been rather infamous for its long and frustrating bureaucratic processes. The infrastructure sector hasn’t been an exception. This has perhaps been the biggest challenge faced by most infrastructure firms.

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Things have definitely started to improve in the recent times but there’s still a long way to go. “One of the biggest challenges is getting the state and local clearances for any new project,” says Shrivastava.

A recent example of a project severely delayed due to clearance issues is the Bandra Worli Sealink (pic on cover page) constructed by HCC. Shrivastava also points out that many projects are still stuck at the state level. “Hence, a major concern lies in the capacity of the states to bid out projects transparently and quickly,” Shrivastava adds.

At any given time, there is a huge pipeline of projects stuck with various ministries. Noteworthy in this context is CII’s suggestion of setting up a National Infrastructure Facilitation & Monitoring Agency to facilitate and monitor implementation of prominent Infrastructure projects. If implemented, this would indeed be a welcome step.

It is essential that all involved elements continue to focus on India’s infrastructure story. It is equally important that they all have a strong support from the government. As Singh of D&B India says, “Economic growth is highly dependent on the quality of infrastructure. Sustained infrastructural spending would ensure long-term sustainability of economic growth and will also create incremental economic opportunities.”

For the sector itself there is nothing but growth ahead. Infrastructure companies are in fact all set to do so. “In the coming 8-10 years, there is a huge opportunity that lies in the infra space and we are gearing up to leverage this opportunity. Maytas Infra is looking at expanding its presence geographically and growing at a consistent pace,” says Madhav.

The key companies also need to realise that they will be playing an important role in many ways other than actually building the infrastructure through their wide geographical reach. For example, a company like Feedback Ventures that has pan-India presence and whose scope ranges from advocating the right policies at the centre and state levels to developing innovative models for infrastructure development (such as Triple-I), can set the right examples.

Thankfully Indian infrastructure companies understand their responsibility. As Shrivastava of Feedback Ventures says: “By virtue of our pan-India presence, we will be transferring the best practices from one part to the other.”

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