Highway projects under PPP scheme fail to deliver: CAG

15 December 2008

The government's thrust on public private partnership (PPP) projects to push investments in infrastructure has failed to give the desired results, a report prepared by the Comptroller and Auditor General (CAG) has said.

The government's key infrastructure ventures based on PPP model have missed the target in 12 out of 17 projects in the first phase of the National Highway Development Programme (NHDP), the CAG said in a report submitted to the Parliament.

The CAG report comes after release of government data on that showed a decline in the growth index of six core industries to 3.4 per cent in October as compared to 4.6 per cent in the same month last year.

Steel production was most affected with a 20 per cent production cut due to the decline in infrastructure sector as per data released by the commerce and industry ministry.

The first phase of the NHDP projects was scheduled for completion in June 2004, but the highway authority was able to complete only five of the 17 PPP projects, the report noted.

The CAG also noted the inordinate delays and losses associated with land acquisition and award of work and acquisition of land. The highway authority clearly does not have the mandatory written code on the basis of which a particular project is assigned for execution under BOT-Toll, the CAG pointed out.