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Higher allotment for highways
Our Bureau
New Delhi
,
Feb. 28
The Government on Tuesday proposed to enhance the budget support for the National Highways Development Programme (NHDP) to Rs 9,945 crore in 2006-07 from Rs 9,320 crore in 2005-06.
It also proposes to open a separate window under rural roads component of Bharat Nirman, under Rural Infrastructure Development Fund (RIDF) XII with a corpus of Rs 4,000 crore in 2006-07. Specific projects under the public private partnership (PPP) model would also be allowed to access RIDF funds. RIDF XI sanctions have touched a level of Rs 7,301 crore as on January 31, 2006.
Tolled expressways
The Government has also decided to develop 1,000 km of tolled expressways on Vadodara-Mumbai, Delhi-Chandigarh, Delhi-Jaipur, Delhi-Meerut, Delhi-Agra, Bangalore-Chennai and Kolkata-Dhanbad stretches.
The concessionaires will be selected through an international competitive bidding process, said the Finance Minister, Mr P. Chidambaram.
For the fiscal 2006-07, Rs 550 crore would be provided for special accelerated road development programme for the North Eastern region. The project has been approved at an estimated cost of Rs 4,618 crore.
NHAI restructuring
The Union Budget has also proposed restructuring of the National Highway Authority of India (NHAI) to make it a multi-disciplinary body with the capacity to handle a large number of PPP projects. New skill areas in planning and quality assurance, standardisation, arbitration, road-safety and research and development will be created.According to the Budget proposal, exemption of service tax has been provided to financial leasing services including equipment leasing and hire-purchase, on that portion of the taxable value comprising 90 per cent of an amount representing as interest — that is the difference between instalment paid towards repayment of lease amount and the principal.
Reactions
Welcoming this move, Mr Hemant Kanoria, Vice Chairman & Managing Director, SREI Infrastructure Finance Ltd, stated, "We are particularly glad that the problem of service tax on lease and hire-purchase transactions has been addressed and there is an assurance for relaxing the external commercial borrowings (ECB) guidelines which will facilitate investments in long-term infrastructure projects."
Mr Amitabh Mundhra, Director, Simplex Infrastructures Ltd, said, "It's crucial that these (infrastructure) outlays are translated into action at a faster pace. However, the policies in terms of depreciation have not been clearly defined by the Budget. We would have appreciated a fast rate of depreciation or investment allowance in terms of capability building."
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