Within the story of India’s rapid infrastructure development, it is hard to miss the swanky expressways and highways that are giving the much-needed thrust to the country’s ambitions. The man behind the massive infra push is Nitin Gadkari, minister of road transport and highways. In an interview, he talks about his strategies for growth and dealing with issues like land acquisition and infrastructure financing. He also responds to the Comptroller and Auditor General’s charge on Dwarka Expressway. Edited excerpts:
Since 2014, India has seen massive infrastructure development. How did you manage to develop infra projects in India at a fast pace?
When I was a minister in Maharashtra, I got the opportunity to build the Mumbai-Pune Expressway, 85 flyovers, Bandra-Worli Sea Link, etc. At that time, my former secretary had mentioned a statement by John F. Kennedy about inspiration and motivation. He said that American roads are not good because America is rich, but America is rich because the prosperity is coming from the roads. Wherever there is infrastructure, water, power, transport and communication, we will get industry, trade and business. At the same time, it will create more employment potential.
The dream of Prime Minister Narendra Modi is to make our country a $5 trillion, atmanirbhar, super economic power. Our mission and dream are to make India the third largest economy, and roads are very important to achieve this target. Without roads, water and power, we cannot have industry and capital, and, without that, there is no employment potential. No employment potential means that you cannot encourage growth. Building infrastructure is very important, which is why, since 2014, the prime minister has given the highest priority to infrastructure development.
My budget for roads and highways project is Rs 2.8 lakh crore. We have public-private investment. We do not have any resource constraint. We are everywhere from Karnataka to Haryana and Kashmir to Kerala, etc. We are constantly pursuing road construction and have got all the ability and potential to make good quality infrastructure. I am giving you confidence that by the end of FY24, our national highway road network will be equivalent to the road network of the USA.
Completing these projects requires massive negotiation in terms of land acquisition. In the past, most of India’s infrastructure projects met with protests by people because they did not want their land to be acquired. This government does not seem to be facing that kind of problem. What has been your strategy?
We decided that new land acquisition and rules will be finalised by the states. Now we are paying really good prices to farmers. The process of land acquisition is with states. Before taking charge as minister, we had 406 stalled toll projects and non-performing assets (NPAs) worth Rs 3.85 lakh crore in the banks. My ministry and I saved the banks from NPAs of Rs 3 lakh crore. Today, we do not have any problem.
For land acquisition, we already have an arrangement with state governments for persuasion and then we get the clearances from the environment and forests ministry of state and Centre and central utility shifting. Without acquiring 90% of the land, we do not go ahead with the final project. So, we do not have any problem and are moving so fast that we are making world records, which is a great achievement. It is not just my credit, but the credit goes to all stakeholders.
Recently, you said that you have not seen a single good detailed project report (DPR) in your lifetime for roads. And you also said that you are thinking of opening projects to international firms. What do you think is the reason behind this?
The problem is that, as part of the tender process, we have to have the DPR. So, there is a problem with our procedure. We are trying to rectify things, by which we will add good quality, and people who can make the perfect DPR can reduce cost. Also, our roads will be free from accidents related to road engineering and use of different materials. We want to use international technology to make good quality roads in the country.
The Comptroller and Auditor General (CAG) has expressed concerns over the cost overruns of the Dwarka Expressway project in the NCR. What is your response?
The actual length of the Dwarka Expressway is 29 kilometres. Given that it is a state-of-the-art project, it has 563 kilometres of single lanes. In the Bharatmala programme, the proposed cost for 5,000 kilometres, with two-to-four lane shoulders, is Rs 91,000 crore, which is Rs 18 crore per kilometre. For the Dwarka Expressway, it was written within brackets that the ring road and bridge cost would be finalised after the finalisation of the DPR. We did not finalise the cost because the DPR was not ready. The cabinet approved that programme. Now, the CAG has erroneously calculated the average cost as Rs 18.2 crore per kilometre by ignoring the nature of the Dwarka Expresway project, which has been clearly mentioned in the approval document of the Cabinet Committee on Economic Affairs.
The e-tender process for the Dwarka Expressway project was transparent, and multiple bidders participated in it for every package. For example, under Package 1, the length of the expressway built was 76 kilometres. There were five bidders. The tender cost was pegged at Rs 1,514 crore, but we awarded it at Rs 1,349 crore, which was 10.91% lesser than the tender cost. Similarly, under Package 2, the sanctioned length was 145 kilometres, and the tender cost for it stood at Rs 1,469 crore, but we awarded it at Rs 1,540 crore, which was 4.83% higher than the tender cost. But in Package 3 and Package 4, we awarded the tender at lesser than the tender cost by 25.12% and 13.73% respectively. The cumulative award cost of all four packages is 12% less than the tender cost.
The National Highway Authority has been temporarily barred by the government from accessing the debt market. Is this a sign of caution?
Not at all. Our rating is AAA. Our problem is that our expenditure is not there. Take the example of InvITs, or the Infrastructure Investment Trusts, model. When we launched our bonds in the capital market, the bond was subscribed for seven days, and, on the first day, the bond was oversubscribed seven times. We are giving 8.05% interest per year and, especially for poor people, we give them monthly interest of 8.05% at AAA rating, while the bank interest is just 5.05%.
The world over, we have seen the problems associated with massive infrastructure development, China being the case in point. How are you insulating India from future troubles about infrastructure development?
Our traffic density is very high. One thing is very important. If you want good services, you have to pay, either to us or somebody else. Public-private investment is the BOT [build-operate-transfer], HAM [hybrid annuity mode] and then different type of projects. I have successfully implemented the project in Mathura where the sewage water is converted to clean water, which is purchased by Indian Oil. This project creates an earning of Rs 20 crore per year.
We can even attract capital investment from the private sector in solid waste management and for increasing the speed of our growth. It is time that, along with the government’s budget, we have more public-private investment. The road sector is the ideal thing for this purpose. It is a success story for the world, the way in which we are making good quality roads by using public-private industry successfully.
