Building infrastructure

Print edition : March 28, 2003

Infrastructure development has been a priority area in Gujarat, and the GIDB plays the lead role in this activity.

THE Gujarat Infrastructure Development Board (GIDB), established in 1995 to facilitate infrastructure development in the State and to coordinate activities in this connection, involving also the private sector, has taken up yet another pioneering step drafting a `regulatory framework' for water supply and sanitation services. It is a natural corollary for a nodal agency like the GIDB to provide a transparent and efficient legal framework to regulate private sector investment in this sector. It had earlier drafted the Gujarat Infrastructure Development Act, 1999, popularly called `BOOT Law'.

The Akri-Mota thermal power plant in Kutch.-BY SPECIAL ARRANGEMENT

The BOOT Law offers several variations in Build, Own, Operate and Transfer policy. This unique and progressive document gives an option of international biding or challenge route. It ensures transparency, consistency and efficiency and provides a level playing field.

A legal framework for water supply and sanitation became necessary, as there is a growing demand for improvement in the quality of water. This would require huge investment, much larger than what had been conceived of so far. It is aimed at providing a transparent platform for investment amidst competition, especially where tariff reforms would be of paramount importance.

As per the `Gujarat Infrastructure Agenda Vision 2010', a unique need-based plan, the GIDB has envisaged an investment of Rs.117,000 crores in 383 projects over the next 10 years in such sectors as roads, railways, ports, power, industrial parks, urban development and gas grid, with almost 70 per cent of the investment expected from the private sector. The GIDB has, in the meantime, initiated a study to provide an `Integrated Public Transit System (IPTS)' for Ahmedabad, the premier city of Gujarat with a population of nearly 4.5 million. It precludes any preconceived notion about a transport corridor or choice of technology. It could be rail-road-skybus-tram.

The Sabarmati River Front Development project in Ahmedabad is another project initiated by the GIDB. It will include the reclamation of about 162 heactares of land by constructing embankments on both sides of the river along a nine-km stretch. This will lead to the retention of water in the river for the whole year, the elimination of flood hazard and the beautification of the city by developing gardens and promenades.

With the Chief Minister as its Chairman and the Industries Minister as Vice-Chairman, the GIDB has powers to decide on the quick acceptance of projects on a fast track basis. It focusses on overall planning and the privatisation of infrastructure projects, prepares projects by conducting feasibility studies, carries out framework studies, prepares model concession agreements which details risk allocation in public-private partnerships, arranges overseas competitive bidding, advises State government departments on financial engineering so that developers have secure investments and coordinates between various sector-specific departments.

Section 10 of the BOOT Law gives an option for the developer to give an unsolicited proposal to the government. It provides for `Limited Competitive Bidding' or `Challenge Route'. It means the private sector would initiate the project to provide the public benefits as a quick response to market demand, thereafter the government would consider the meritorious projects and then put them through the challenge route. All projects initiated by the government or by the developer under Section 10 would have to go through the competitive bidding procedure. This ensures transparency, low cost and good-quality infrastructure, and subsequently the end-user will benefit.

THE Gujarat government is all set to put the State on the international map by building world-class infrastructure and gain a competitive advantage over other States in India. As a result various State departments and the GIDB have started a number of projects. Those fully or partially commissioned include the Mundra and Pipavav ports, Gujarat Chemical Port Terminal Ltd, Ahmedabad-Mehsana and Vadodara-Halol highways, the Watrak bridge, the Jadeshwar bridge, the Gujarat State Wide Area Network (GSWAN) and InfoCity, involving private sector initiative. Ongoing projects include the LNG terminals at Hazira, Dahej and Pipavav, a high-pressure gas pipeline, re-gasification plants, port-linked railway lines between Surendranagar-Pipavav, the Chhayapuri rail overbridge and the Gandhidham-Palanpur gauge conversion project.

The phenomenal growth of Adani Export Ltd (AEL), the flagship company of the Adani Group, from a Rs.214-crore export house in 1997-98 into a Rs.4,500-crore corporate conglomerate in five years, is a success story of private sector initiative in hitherto unexplored areas, particularly in the infrastructure and service sectors. The Adani Group, which has conquered many a shore in the export-import, manufacturing, infrastructure and service sectors in Gujarat, is on an expansion spree across the State.

The tank farms of the Adani group in Mundra port.-PARAS SHAH

It is now exploring the options of starting open-cast mines and coal washeries in Madhya Pradesh and Orissa, a port-based edible oils refinery at Kakinada in Andhra Pradesh and 300 call centres across the country. It has already shown an interest in setting up an all-weather, deep-berth modern port at Gopalpur (Orissa) and a Special Economic Zone (SEZ) near the proposed port on the east coast.

In Gujarat, the Ahmedabad-based group plans to diversify into many more areas to set up a 2x250 MW imported-coal-based power plant at Zarpara in Kutch district under a consortium with Korean and Malaysian firms, a SEZ at Navinal Island (adjoining its green-field Mundra port in the Gulf of Kutch), an export-oriented industrial salt manufacturing unit, also at Mundra, an agro food park at Dahej in the Gulf of Cambay, and a gas distribution network for domestic, commercial and industrial use in select areas of the State.

THE Adani group's first strategic move was to develop and operate a modern port at a greenfield site at Mundra, about 60 km west of Kandla. Adani Port Limited formed a joint sector company with Gujarat Port Infrastructure Development Co Ltd. to float Gujarat Adani Port Ltd.

With all back-up facilities in place, the march ahead began in 1998. The port is projected to handle 5 million tonnes of cargo per annum (mtpa) by 2003, 40 mtpa by 2010, 60 mtpa by 2015, 100 mtpa by 2020 and 150 mtpa by 2025.

The Adani Container (Mundra) Terminals Ltd. is setting up a world-class container terminal in consultation with Cullen Grummitte and Roe (International) Pty of Brisbane. Kvaerner Cementation (I) Ltd is involved in the construction and Polygon Services Sdn Bhd of Malaysia in the training of personnel and in the marketing and operational aspects of the terminal.

With edible oils forming a major component of imports through the Mundra Port, the group floated Adani Wilmar Limited to set up a sophisticated edible oil refinery at Mundra in a 50:50 joint venture with Wilmar Holdings Pte Ltd of Singapore. The plant has the capacity to refine 600 tonnes per day (tpd) of edible oils and 100 tpd of vanaspati.

The group tries to fulfil its share in corporate commitments too, through the Shri Shantilal Bhudarmal Adani Charitable Trust, reaching out to the poor, aged, infirm, mentally and physically challenged and the marginalised, in the belief that success has value only when it is shared.

INDIA's ports are notorious for their long turn-around time, but for vessels berthing at Kandla port the turn-around time was reduced by 11 hours, or by 14 per cent to 3.22 days in January 2003, compared to the same month last year, thanks to an ambitious modernisation programme undertaken by the Kandla Port Trust (KPT). The average turn-around time for break bulk cargo vessels has shortened by 24 hours, or by 15 per cent to 5.83 days and that for dry bulk cargo vessels by 55 hours or 29 per cent to 7.73 days.

One of the unique strengths of the port is its productivity-linked berthing policy, suitably customised with the `cargo mix' that arrives at the port, taking note of the requirements in consultation with the port users. It has already optimised the port's performance to a great extent. However, it still has to go a long way to match the best. The `cargo mix' has been arranged in such a way that out of the 10 dry cargo berths, one has been set aside for 24-hour turn-around priority, three for export and two each for import and container vessels, as per the government's revised berthing policy directives.

According to its modernisation programme, KPT proposes to increase the draft by up to 13 metres by 2004-05 for ships up to 80,000 deadweight tonnage (DWT) and 250 metres LOA safety berth, develop a modern container terminal with 400-metre water front, induct 100-tonne mobile harbour cranes, and create more covered storage.

WITH the conversion of the Surendranagar-Mahuva metre gauge railway line into broad gauge and its extension up to Pipavav, the volume of traffic at the Pipavav port, on the Saurashtra coast, the country's first private sector port will increase soon. The 268-km rail link is likely to be operational by March 31, 2003.

The Gujarat Pipavav Port Limited (GPPL) and the Indian Railways had set up Pipavav Railway Corporation Limited (PRCL), a special purpose vehicle (SPV), to implement this project, opening up the northern, central and western of the country to the port.

Meanwhile, the port has been prepared to handle over 4 million tonnes per annum (tpa) bulk cargo, including wheat, rice, de-oiled cake, cement, clinker, coal and chemicals. Port users will benefit from high rates of material handling and faster vessel turn-around, which are amongst the many features of the high service standards that the port assures the trade.

To service the growing container volumes on the western coast, the Pipavav port plans to develop a modern container terminal capable of handling efficiently the new generation post-Panamax container vessels. This will transform Pipavav into a most modern hub port in the region extending from South Asia to West Asia. Messrs Scott Wilson Kirkpatrick has prepared the master plan for the container terminal.

GPPL had taken the initiative to create India's first port in the private sector in the early 1990s. Today, it is a modern deep-water and all-weather port, which facilitates direct berthing with the state-of-the-art cargo handling equipment imported from Europe.

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