Posted on 02/07/2018 10:09:37 AM PST by Tolerance Sucks Rocks
NEW DELHI: A turf battle for national highways has erupted with the department of economic affairs (DEA) seeking to take control of the funding for the highway construction programme.
After unsuccessfully pushing for corporatisation of the National Highways Authority of India (NHAI), the DEA has proposed changes in the Central Road Fund (CRF) Act to take control of the allotment of fuel cess for infrastructure projects and to decide the priority of expenditure.
So far, the road transport and highways ministry is entitled to get the largest share of the CRF, estimated at 41%. The proposal to use 2.5% of the CRF from road ministry's share was passed by Parliament in December.
Now, the finance ministry has proposed further amendments by including it in the Finance Bill, as was reported in TOI on Saturday.
Sources said that the plan worked out by the finance ministry is tough to implement since the finance minister will have to clear all projects that get funding from the CRF. In 2016-17, nearly 1,000 projects were approved under the CRF. "Going by the proposal in the Finance Bill that the panel under FM will decide each infrastructure project and the increased ambit of the law, there will be a huge number of agenda items. It may become another bureaucratic challenge and may delay projects across sectors," said a source.
The amendments come months after the NHAI board was restructured at the behest of the PMO and saw the ouster of the economic affairs secretary, who has been replaced by NITI Aayog CEO as a part-time member.
Now, the CRF will be amended as Central Road and Infrastructure Fund (CRIF) and the amount collected under this fund will be utilised for more than a dozen sectors including road, rail, port, telecom, power, water supply and sanitation, a move that may prompt the NHAI to hunt for resources although most fuel buyers believe that they are contributing to the highly-successful highway construction programme since the Vajpayee government's tenure.
While expanding the ambit and increasing the cess from Rs 6 per litre of petrol and high speed diesel to Rs 8 per litre, the finance ministry has also taken control of the allocation of the fund. The CRF has increased over 300% between 2014-15 and 2016-17.
While in 2014-15 it was Rs 25,122 crore last financial year it touched Rs 80,800 crore.
(1 crore = 10,000,000)
Is there a high speed rail line involved?
Well, apparently, if the new bill passes India’s parliament, some of it will go to rail, which I believe was the case beforehand.
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