Infra: Govt regains form, debutant player to perform well
UR Associates has come out with its report on infrastructure sector. According to the research firm, there are around 100 projects of over Rs 10 bn awaiting clearances from various ministries.
December 18, 2012 / 12:32 IST
UR Associates has come out with its report on infrastructure sector. According to the research firm, there are around 100 projects of over Rs 10 bn awaiting clearances from various ministries. With the economic growth slipping down and investments taking a backseat, this formation of CCI assumes significance.
One of the major concerns for the infrastructure sector in setting of mega projects was the delay in necessary approvals for the projects and land acquisitions in majority of the cases. The government finally put its best foot forward to accelerate approvals for mega projects by approving the setting up of Cabinet Committee on Investments and the land acquisition bill. This is believed to result in spur investments and growth which has been marred by the delay in environmental & forest clearances and also delay in land acquisitions.A Cabinet panel headed by the Prime Minister will be set up to speed up clearances for projects of more than Rs 10 bn costs and ensure expeditious approval if timelines are not adhered to. If there are difficulties in big projects in sticking to deadlines, CCI will look into them and efforts will be made to expedite them. The Cabinet Committee on Investments (earlier to be named as National Investment Board) apart from the Prime Minister as head, also includes the Finance Minister, Law Minister and the other key infrastructure ministries at the panel. The committee will monitor the progress of decision making and also implementation of projects. As per the officials, the Cabinet Committee on Infrastructure will be wound up, with the setting up of Cabinet Committee on Investments.There are around 100 such projects of over Rs 10 bn awaiting clearances from various ministries. With the economic growth slipping down and investments taking a backseat, this formation of CCI assumes significance. As per Business Standard (BS), the investment rate in the economy has fallen from the peak of 38.1% of GDP in the pre-crisis period of 2007-08 to 34.7% in 2011-12. In the current financial year, the investment rate is projected to grow to 35.3%. As reported by BS, according to an official data about 47% of the 183 central projects, costing over Rs 10 bn were delayed by up to 5 years, while 37% reported cost overruns by up to 200% as on 31 March, 2012. This move from the Government is expected to bring back long term investment and bolster investors’ sentiment.Disclaimer: The views and investment tips expressed by investment experts/broking houses/rating agencies on moneycontrol.com are their own, and not that of the website or its management. Moneycontrol.com advises users to check with certified experts before taking any investment decisions.To read the full report click on the attachment 
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