The Associated Chambers of Commerce and Industry of India has proposed to the government to put in place an Effective Project Implementation Regulator to monitor timely execution of projects of Navratna and Mini Navratna public sector undertaking companies.
In a representation submitted to Ministries of Finance, Commerce & Industry and Planning Commission including the Prime Minister’s Office by Dr Swati Piramal president of ASSOCHAM, the chamber has made a strong case for a regulator since vast majority of PSU projects are delayed in the absence of a watchdog.
According to Chamber estimates, cost of delays on projects implementation in the last one decade is conservatively pegged at INR 200,000 crore for whole of economy and PSUs, especially those in category of Navratna and Mini Navratna slightly lesser than INR 100,000 crore.
The ASSOCHAM is of the views that due to variety of reasons including frequent delays of required clearances from Public Investment Board’s more than 60% of projects suppose to be executed by Navratna and Mini Navratna companies are never completed as per promised schedule.
Dr Piramal said that this not only inordinately delays project implementation for many years and sometimes for decade but also amount to multiple cost escalations which a growing economy like India can no longer afford. Therefore, the time has come when collective efforts need to be put in by Prime Minister Office, Finance & Commerce Ministries including that of Planning Commission for working out a framework for a regulator that can monitor project implementation of mega projects.
Experience has showed that over 50% of projects announced for implementation as well as capacity expansion in sector like road, ports, highways, power, oil & natural gas, railways and telecommunication have hardly been commissioned as per promised time frame. This has happened since public sector companies are more often than not denied PIBs clearances due to inter Ministerial wrangling, sometimes deliberate and often arise out to meet constitutional and legal obligations and on environmental grounds as well. The blame for this often falls on executors but finally it is the nation that suffers.
This practice needs to be discouraged and efforts put in on war front so that the proposed regulator is put in place with sufficient teeth and constitutional powers to ensure that public sector companies are given timely clearances, water and power connections and land acquired for such projects without any delay which can be possible provided the compensation amount is adequate and that no public outcry goes against execution of projects implementation.
http://www.steelguru.com/news/index/2010/01/19/MTI5MjQ4/Regulator_needed_for_scheduled_take_off_of_PSU_projects_-_ASSOCHAM.html
Tuesday, January 19, 2010
Regulator needed for scheduled take off of PSU projects - ASSOCHAM
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