New panel to fast-track infrastructure projects

NEW DELHI Thu Dec 13, 2012 10:04pm IST

1 of 2. Labourers are silhouetted against the setting sun as they work at the construction site of a residential building in Hyderabad October 5, 2012.

Credit: Reuters/Krishnendu Halder/Files

Related Topics

NEW DELHI (Reuters) - The cabinet approved the creation of a special panel on Thursday with watered-down powers to speed up the notoriously slow implementation of big-ticket infrastructure projects.

The panel, to be chaired by Prime Minister Manmohan Singh, will fast-track projects worth 10 billion rupees or more, said one minister who attended the cabinet meeting and who declined to be named.

The government hopes the new body will help to increase investment in an economy that is likely to slow in fiscal 2012/13 to its worst pace in a decade. Singh's chief economic adviser sees full-year growth of 5.5 percent to 6 percent.

Infrastructure companies have pressed for the creation of such a board to speed up hundreds of delayed projects. Regulatory hurdles, such as delayed land acquisition and environmental clearances, have held up projects worth over 2 trillion rupees in the road, power, coal and mining sectors alone, according to government data.

However, due to opposition from within the government, the powers of the panel have been diluted and it will not be able to directly clear the projects.

It will be up to individual ministries to approve projects, but where there are delays, the new panel will have the authority to intervene. It will not, however, be able to overturn any decisions made by the Environment Ministry.

Environment Minister Jayanthi Natarajan had stalled the creation of the panel for months, calling it authoritarian.

The watering down of the panel's powers, which will likely disappoint investors, underscore the government's struggle to push a reform agenda aimed at reviving growth.

Red tape can delay projects for years or, in the worst cases, scupper them altogether. Bureaucracy and fights between industry and farmers over land have prevented India from plugging huge power shortages and upgrading its decrepit transport network.

A typical infrastructure project requires clearances from 19 federal ministries and, on average, 56 authorisations on issues ranging from the environment to defence. The whole process takes up to 24 months.

(Additional reporting by Manoj Kumar; editing by Stephen Nisbet)

Comments (0)
This discussion is now closed. We welcome comments on our articles for a limited period after their publication.

  • Most Popular
  • Most Shared

Market Eye


Bullish on Equities

Bullish on Equities

Bullish on Indian equities, but gains seen 'less sharp'- Goldman Sachs  Full Article 

Streamlining Operations

Jet Streamlines

Jet Airways chairman says looking to restructure debts, talking to bankers  Full Article 

Political Economy

Political Economy

Analysis - Watch what markets don't do as world politics turns nasty   Full Article 


Honda's India Thrust

Honda's India unit to account for 25 pct of Asia Pacific sales by March 2017 - exec   Full Article 

Short of Expectations

Short of Expectations

Apple revenue lags Street's view despite strong China growth  Full Article 

Mircosoft Results

Microsoft Results

Microsoft revenue rises, profit falls as Nokia absorbed  Full Article 

Relief For Sahara

Relief For Sahara

Supreme Court could allow Sahara boss to conduct asset sale talks, company says.  Full Article 


Food Scandal

Five held in China food scandal probe, including head of Shanghai Husi Food   Full Article 

Reuters India Mobile

Reuters India Mobile

Get the latest news on the go. Visit Reuters India on your mobile device.  Full Coverage