Himachal Pradesh Government today strongly advocated the active participation of private sector in construction of road development in the State.
While speaking in national conference on Public Private Partnership (PPP) in national highways in Vigyan Bhawan New Delhi, Thakur Gulab Singh Public Works Minister said that road sector has been given the highest priority in hill state and added that state has extensive road network of 31973 kms. He said that State has 1458 kms stretch of national highways. He told that at present no national highway has been exclusively constructed in PPP mode in the State.
Thakur Gulab Singh that national highways authority of India has opened programme implementation unit at Solan for four-laning of Parwanoo-Solan and Nerchowk-Manali road network. He announced that land would soon be acquired for these two roads by the State Government soon and said that Detailed Project Report for Solan-Shimla stretch would be completed soon. He requested the Union Government to expedite the work on four-laning of Parwanoo-Solan road stretch by taking prompt decisions and also providing necessary procedural sanctions to national highways authority of India.
Public Works Minister requested the Union Government to provide additional budgetary support for implementations of PPP mode road projects in Himachal Pradesh as there is low traffic density corridors in the state and central assistance is required for growth and balanced development of national highways in the state at par with plain areas where there is low construction cost and high traffic volumes.
Thakur Gulab Singh said that four critical element of traffic volumes, user fee, concessional period and capital cost that determine the financial viability of highways projects are not favourable to private sector in the state due to tough geographical and topographical conditions and lesser population in the State and requested the Central Government to enhance the budgetary support for hill states keeping in view of the realistic conditions.
Public Works Minister said that PPP mode in context of highway development in Himachal Pradesh on toll basis is not financial viable due to high construction cost, low traffic volumes, long construction period and other issues of forest clearances and environmental degradation. He said that limited working seasons in higher hilly and tribal areas and absence of diversion roads are key determinate factors for investment by Private sector in hilly areas which has adversely affected the road development in Himachal Pradesh. He said that widening of roads under PPP mode is not financially viable because of long gestation period and limited financial returns and Government support is essentially required for such projects in hilly areas.
Thakur Gulab Singh suggested the adoption of BOT (annuity) mode for financing of National Highways in India on Private Financing Initiative model under which selected private bidder is awarded contract to develop a section of highway and to maintain it over the whole period. The private bidder is compensated with fixed annual payments for his investment in the project which reduces the commercial risks involved with project operations.
