Has the Union Budget 2013 spurred the economy into greater momentum?
Has the FM grabbed the moment to shake the economy off its stupor? While the answer to the first question is in the affirmative, the second one can at best elicit an unsure response. Just like when the economy is booming, it is difficult to tell the telltale sign of a gradual slowdown, similarly when it is meandering aimlessly, it is difficult to see it gathering steam and direction.
Many years ago Lalu Yadav in one of his many boisterous moments told a journalist that he would ensure that the roads in Bihar would be as smooth as actor Hema Malini's cheeks, eliciting both laughter and cynicism nationwide.
Whether the quality of macadam in the political maverick's home turf has changed or not has been a matter of endless debate since then, but in circa 2013 the makeup seems to have gotten smudged on the visage of the minders of the National Highways Authority of India (NHAI), that august body which manages India's ambitious roads programme.
Veritably the highways dream seems to have soured; and the much bandied road sector cosmetic is peeling off. With two of its principal actors quitting the stage much before the play got over - GVK and GMR have walked out of mega road projects they had bagged after paying a premium to the authorities - NHAI, already lagging behind in its original target of completing stretches of 20 km per day, and even falling short in its revised programme, is now at the crossroads. The roads body faces not just the possibility of a rebellion from other private sector players but the ignominy of its authority being severely challenged. It is instructive that close to 251 players have at various points of time initiated arbitration proceedings against the NHAI. Their collective claim in the courts runs to a whopping Rs 13,000 crore. Further faced with further delays owing to systemic failure, legal hurdles and possible exits, subtraction in income, dip in investments, corruption, and consequent loss of face, NHAI czars are now looking to set its house right. Such is the urgency that the Prime Minister's office has had to intervene several times this month in a bid to stem the rot. This issue's cover story examines the implications of the GMR-GVK exit and the consequent damage control measures.
Also in this issue is a special feature on the second edition bC India show, held in Mumbai early February. The organising authorities have managed to pull the show off despite a difficult year recording 28,000 visitors. There are whispers on the role of associations in stonewalling an even play which is not in the interest of a healthy developing industry. Creation of barriers of entry by existing associations like BCCI was recently penalised by the Supreme Court and a similar simmer seems to flicker beneath the surface. The buzz is that equipment firms like Hyundai, JLG and Manitowoc have bagged several orders for their products at the exhibition thanks to some detailed planning and preparation. For a large number of others bC India has been more exploratory, a chance to view the latest in technology, and prepare businesswise for other exhibitions to be held later this year.
Coming to the budget, the investment allowance proposal could be a trigger for construction equipment manufacturers to step up investments in India and use it as a sourcing hub. Finally, the devil is the in the details and no amount of announcements of mega projects means anything unless they can be executed in time.
Debottlenecking of project execution is what the infrastructure and construction sector really needs and the establishment of a road regulator is a step in the right direction.