Govt to set up road regulatory authority

 Finance Minister P Chidambaram on Thursday announced the proposal to set up a road regulatory authority to address issues such as financial stress, construction risk and contract management in the sector.

Presenting his budget, the Minister said the independent regulatory authority will be set up in 2014 to address all issues faced by the road sector.

The key functions of the proposed regulator are likely to be tariff setting, regulation of service quality, assessment of concessionaire claims, collection and dissemination of sector information, service-level benchmarks and monitoring compliance of concession agreements, among others.

Since NHAI is a signatory to the concession agreement it cannot be a regulator, changes in the term of concessions would be looked after by the independent regulator.

The government also said that the bottlenecks stalling road projects have been addressed and 3,000 kilometres of road projects in Gujarat, Madhya Pradesh, Maharashtra, Rajasthan and Uttar Pradesh will be awarded in the first six months of 2013-14.

The Finance Minister allocated Rs 14,873 crore to Jawaharlal Nehru National Urban Renewal Mission (JNNURM) and in which major portion will go to purchase of buses to improve the quality of public transport system.

Infrastructure got a major thrust in Budget 2013-14 with the Finance Minister announcing a slew of measures to boost sector's growth, like raising Rs 50,000 crore through tax-free bonds and setting up of major ports.

"While every sector can absorb new investment, it is the infrastructure sector that needs large volumes of investment," Chidambaram said emphasising on the need to create "new and innovative instruments to mobilise funds" for meeting infra investments targets of Rs 55, 00,000 crore in 12th Plan.

The private sector will share 47 per cent of the investment, he said. Debt funds for infrastructure would be encouraged and tax-free bonds up to Rs 50,000 crore will be allowed in 2013-14.