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Mar 21, 2017 08:24 AM IST | Source: Moneycontrol.com

'Grand Challenge': Govt plans to pit states against each other for a Rs 10,000 crore bounty for road projects

The government is working on a Smart City-like ‘Grand Challenge’ scheme for states to compete with each other to get Rs 10,000 crore every year in grant for their various road projects, according to an official familiar with the development.

'Grand Challenge': Govt plans to pit states against each other for a Rs 10,000 crore bounty for road projects

Dhirendra Tripathi

Moneycontrol News

The government is working on a Smart City-like ‘Grand Challenge’ scheme for states to compete with each other for Rs 10,000 crore every year in grant for their various road projects, according to an official familiar with the development.

“The entire Rs 10,000 crore will have to be spent in one year. The amount will be sanctioned and the funds will be released as and when milestones are achieved,” the official said.

The winner state will have to fulfill some 12-13 parameters – this could include ensuring land acquisition is in place before the grant is sought, securing clearances and execution performance of the state public works department in the last two to three years.

“The Cabinet note is being prepared for this and the approval could come in April. The scheme could even have a clause barring the state from participation for two to three years in case it has failed to secure the entire grant in a year,” he said.

He said the funds could be spent on projects of National Highways Authority of India (NHAI) as well as non-NHAI projects.

“Ten thousand crore rupees is a big amount. The funds therefore will be allowed to be utilised for any number of road projects a state government wishes to execute under the scheme,” the official said.

The proposed scheme goes in-line with the philosophy of the Narendra Modi government that favours encouraging competition amongst states to grab central assistance, while at the same time partnering the states in their social and infrastructure projects.

Union Finance Minister Arun Jaitley has allocated Rs 64,900 crore to the ministry of road transport and highways for 2017-18 on a net basis after accounting for recoveries.
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