Mega projects in India Environmental and Land Acquisition Issues in the Road Sector

G. Raghuram, Samantha Bastian and Satyam Shivam Sundaram

No WP2009-03-07, IIMA Working Papers from Indian Institute of Management Ahmedabad, Research and Publication Department

Abstract: Mega projects (primarily infrastructure) receive a sizable investment (~10%) of the gross fixed capital formation in India. Environmental clearances and land acquisitions have been the two major reasons for delays in the projects. However, there has been a steady increase in the proportion of projects running on schedule and a sharp decline in the proportion of projects with cost overruns. These accomplishments have been achieved due to better financing, project management, and reform in the regulatory frameworks related to environmental and land acquisition aspects. The acceptance of a user fee and development of alternate sources of revenue have helped attract larger investments in mega projects. With increasing private sector participation, delays due to project management are expected to reduce. The modifications in the regulatory framework on environmental and land acquisition issues are moves in the right direction. However, methods used for assessments related to environmental impact and land acquisition are still manual, making the whole process time consuming. Technology could be a good instrument in reducing the time required for these assessments as well as in bringing transparency in the system. Decentralization with capacity building at the state level would also help in the long run in reducing these delays.

Date: 2009-03-07
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