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Study of 5 Year Plans

By
Manoj Bharadwaj
Fortress Financial Services ltd.
Mumbai
Railways 10th 5YP:
Financial Review of Tenth Plan

Internal and Extra Budgetary 33,000


Resources 46,545

27,600
Gross Budgetary Support
38,163

60,600
Total
84,708

0 20,000 40,000 60,000 80,000 100,000

Original Outlay (in Rs. Crore) Outlay achieved (in Rs. Crore)

Freight Traffic

• Estimation of the freight traffic during 10th five year plan was
624 Million Tonnes of originating traffic and 396 Billion Tonne
Km of transportation output.
Freight Performance during Tenth Plan
Year Originating Annual Growth Freight Output Annual Growth
loading Rate (Billion Rate
(Million Ton) NTKM)

2001-02 492.5 - 333.23

2002-03 518.7 5.32% 353.19 5.60%

2003-04 557.4 7.36% 381.24 7.94%

2004-05 602.1 8.02% 411.28 7.88%

2005-06 666.5 10.70% 441.76 7.41%

2006-07 726.0 8.93% 476.77 7.92%

Average growth 8.1% 7.4%


rate

OL (Million Ton)
800
FO (Billion NTKM)
700 600
600 500
500 400
400
300
300
200
200
100 100
0 0
2001-02 2002-03 2003-04 2004-05 2005-06 2006-07 2001-02 2002-03 2003-04 2004-05 2005-06 2006-07
Traffic Growth of Different Commodities Cargo Handled (in million
tonnes)
800
700 2001-02 492.5
600
500 2006-07 726
400
Incremental 233.5
300
2001-02 loading
200
2006-07
100 CAGR 8.07%
0

2001-02 2006-07
Iron & Steel ,
14.5 Others ,
Fertilizers , 27.2 53.56 Iron & Steel , 19 Others , 103

Fertilizers , 36
Foodgrains ,
32.82 Coal , 229.69 Coal , 310
Foodgrains , 46
POL , 35.62

POL , 33
Cement ,
65
Cement , 44.04
Ore - Export Ore to Steel Ore - Export , Ore to Steel
, 15.72 Plants , 39.35 52 Plants , 62
Targets and achievements
Tenth Plan target At the end of Tenth Percentage of
plan completion
New Lines (kms) 1310 945 72.13%

Gauge Conversion 4000 4432 110.8%


(kms)*
Doubling (kms) 1575 1363 86.53%

Track Renewals (kms) 23000 24053 104.57%

Railway Electrification 1800 1809 100.5%


(kms)
Wagons 65000 86619 133.26%

Coaches 9160 10722 117.05%

EMUs (no.s) 1965 869 44.22%

MEMU / DEMU (no.s) 750 610 81.33%

Diesel Locomotives 444 607 136.71%


(no.s)
Electric Locomotives 343 524 152.76%
(no.s)
Reason for achievement

• Improved asset utilization has played a major role in the


performance

• Decision to use the carrying capacity of the wagons


optimally by increasing the loadability of the wagons on
selected routes up to 15 per cent

• The realignment of tariff to the competitive conditions in


the market and incentives for loading in the lean season
and the empty flow direction.

Improvements in commodities:

• Major increases were seen in coal, iron ore for export and
steel plants, cement and other commodities (which include
containers).
Outlook for the Eleventh plan
Plan Outlay
• The total outlay for the 11th five year plan works out to Rs. 251000 crore.
• Nearly 3 times jump in allocation from the previous plan

Financing for the 11th Five Year Plan – Split Up (Rs. Crore)

(c)Extra
(a)Capital
(Rs. Crore)
Budgetary
from General
Resources ,
Exchequer ,
(a) Budgetary 86000
75,000 Support
80,300

(b) Internal 90,000


(a)Contributi Resources
on for SRSF ,
(b)Internal 1,200 (c) Extra Budgetary 75,000
Resources , (a)Diesel Resources
90,000 Cess for
Safety Fund ,
4,500
Forecasts of Traffic
Year Originating Freight Output
loading (BTMKs)
(million tonnes)
2006-07 748 497 Assumes Annual Growth
2007-08 801 532
rate of for Originating
loading 7.11% and 7.12%
2008-09 858 570 for Freight Output
2009-10 918 610

2010-11 984 653


*
2011-12 1055 701

Traffic Forecast
1200

1000

800
Assumes GDP growth of
600
8%, Rail Transport
Mtonnes
BTMKs
Elasticity of 0.87
400

200

0
2006-07 2007-08 2008-09 2009-10 2010-11 2011-12
Commodity-wise Projection for the Terminal Year

Originating Loading (in million tonnes) 1 Coal-Total


2 Iron Ore- Steel Plants
1200 3 Iron Ore - Exports
4 POL
1000 5 Fertilizer
6 Cement
800 7 Finished steel
8 Food grains
600 2006-07 Others including containers
9
2011-12 10 Grand Total
400

200

0
1 2 3 4 5 6 7 8 9 10 Yield per million ton (YPMT) will be
Revenue NTKMs (in Rupee billion)
at an average of Rs. 62.67 crore
800 from the present level of Rs. 59.8
700 crore. It is assumed that YPMT will
600 increase gradually in the range of
500
2.2% to 3.8% every year.
400 2006-07
300 2011-12

200

100

0
1 2 3 4 5 6 7 8 9 10
Capacity Enhancement – Spread of Funds
Other Measures for Running Of 25 Tones Axle Running Of 23/24 Coach
Enhancing Capacity Load On Iron Ore Routes Length Trains
3% 3% 1%

Metropolitan Projects
6%
New Line Projects
12%
Other Railway Electrification
Traffic 4%
Facility
works Logistic Park
3% 1%

Freight Terminals
2%
Grade
Separators/Flyovers/Bye-
pass lines Gauge Conversion
2% 24%

Terminals at State Capitals


and important tourists
places
1% Traffic Facility Works
Mega Terminals at 11%
Metropolitan cities
2%

Doubling
Total Funds allocated:
25% Rs. 77,050 crore
New Policy Initiatives
vWork on Dedicated Freight Corridors on the Eastern and Western routes have
been initiated.

vContainer Policy Liberalization

vWagon Investment Scheme

vRail-side Warehousing Scheme

vLiberalisation of Siding Rules

vTerminal Incentive Scheme and Freight Incentive Schemes

Rail Vikas Nigam Limited (RVNL)


It was set up as a special purpose vehicle to execute the bankable projects for
strengthening of Golden Quadrilateral and Port / Hinterland Connectivity under the
National Rail Vikas Yojana (NRVY).
Roadways Review of 10th Plan
Financial Review of Tenth Plan

9092.9
Internal and Extra Budgetary Resource
20892

32278.67
Gross Budgetary Support
41232.94

41371.57
Total
62124.94

0 20000 40000 60000

Outlay Achieved (Rs. Crore) Initial Outlay (Rs. Crore)

Physical Achievement:
The Tenth Plan envisaged the top priority in completion of:
Ø GQ
Ø Phase I of NS- EW Corridor
Progress of the National Highways Development Project
The overall progress of NHDP as on February, 2007 is as under:
NHDP Total Completed Under Implementation Balance for
Component Length Four Lane award of civil
Length No. of works
(km) contracts

GQ 5846 5540 306 35 -

NS-EW 7300 1080 5150 146 908

Port 380 145 214 7 21


connectivity

Other NHs 945 287 638 16 20

NHDP –IIIA 4035 30 1404 22 2566

NHDP-V 6500 148 2 6352

Total 25006 7082 7860 228 9867


Historical Growth of National Highways
Total length in Kms
80000
70000
60000
Pre-Liberalization
50000
40000
Average Growth of
30000
20000
NH during each 5 YP
10000
0 is 4.34%

Number of
kilometers added
12,249 km.

Length added in Kms


25000
22500 Post-Liberalization
20000
17500
15000 Average Growth of
12500
10000
7500 NH during each 5 YP
5000
2500
0 is 24.08%

Number of
kilometers added
39,901 km.
Outlook for 11th Five Year Plan
Availability of Funds for 11th Five Year Plan: (Rs. Crore)
Total : Rs. 1,73,501
Cess 36,589
crore
External
Assistance
4,454
Share of
private
sector Borrowings About 4 times jump in fund
87,735 by NHAI allocation from the
41,615
previous plan
Surplus from
the user fee
3,108

• The target for new addition of length in NH network in 11th Five Year Plan would
be about 7000km.
• A road vision 2021 was prepared in the Ministry, which proposes a total National
Highway network of about 80,000 km by the end of the year 2021.
Projects undertaken by NHAI:

S. No. Name of Project Likely Cost (in Rs.


Crore)
1. Completion of GQ and EW-NS 52,434
corridors
2. 4 -laning of 11,113 km under NHDP 72,454
Phase-III
3. 2-laning with paved shoulders of 27,800
20,000 km of National
Highways under NHDP Phase-IV
4. 6-laning of selected stretches of 41,210
National Highways under
NHDP Phase-V
5. Development of 1000 km of 16,680
expressways under NHDP
Phase-VI
6. Construction of ring roads, flyovers 16,680
and bypasses on selected stretches
under NHDP Phase-VII.
Total 2,27,258
Targets:
NHDP Component Target for Completion
Completion of GQ March, 2007 *
Completion of NS-EW Corridors, December, 2009
Port Connectivity & other
projects under NHDP-Phase-I&II

Completion of NHDP-Phase-III December, 2013

Completion of NHDP-Phase-V December, 2012

Completion of NHDP-Phase-VI December, 2015

Completion of NHDP-Phase-VII December, 2015


Current Status of the projects:
Corridors Total Length Length Length Under Balance for
(in km) Completed implementation award
(in km) (in km) (in km)
Golden 5846 5713 133 ----
Quadrilateral
North-South & 7142 3291 3030 821
East-West
Port 380 206 168 06
Connectivity
NHDP Phase-III 12,109 659 1816 9624
NHDP Phase-V 6500 77 953 5470
Total 32939 10705 6283 15951

• Out of a total length of 6283 kms under implementation, 4/6 laning has been completed for a
partial length of 2130 kms.
Agencies taking up development work:
The development and maintenance of National Highways are implemented
on agency basis.
1. The Government of States / Union Territories (PWDs of State / UTs)
2. The National Highways Authority of India (NHAI)
3. Border Roads Organisation (BRO)
Agency Length of National Highways
under the respective agencies

The Government of States / 43,705 km


Union Territories (PWDs of
State / UTs)

The National Highways 16,117 km


Authority of India (NHAI)
Border Roads Organisation 5,512 km
(BRO)
Total 65334 km

*As on Feb 2007


State Roads and Major District Roads
• State Highways (SHs) and Major District Roads (MDRs) constitute the secondary
system of road transportation in the country.
State Highways (SHs) Major District Roads (MDRs)
Provide linkages with the Runs within the district
National Highways, district connecting areas of
headquarters of the state and production with markets,
important towns, tourist connecting the rural areas to
centres and minor ports. the district headquarters and
to State Highways and
National Highways.

Their total length stands at Their length is estimated at


about 131,699 km. around 467,763 km.

• These roads also carry medium to heavy traffic. It is assessed that the secondary
system carries about 40 % of the total road traffic, although they constitute only
about 13 % of the total road length.
Deficiencies in the Present System
A total amount of Rs. 8,000 to 10,000 crore per annum is being made available
against the requirement of at least Rs.16,000 crore per annum.

The result is, there are several deficiencies in the existing SHs and MDRs as:

v Inadequate width of carriageway in relation to traffic demand


v Weak pavement and bridges
v Congested stretches of SHs and MDRs passing through cities/towns
v Poor safety features and road geometric and inadequate formation width in hilly
and mountainous region
v Missing links and bridges
v Several railway level crossings crying for replacement with ROB/RUB.

A broad assessment shows that over 50 % of SHs and MDRs network has poor
riding quality.
Losses due to poor condition of these roads would be around Rs. 6000 crore
per annum besides their premature failure resulting in huge rehabilitation and
reconstruction costs implying infusion of avoidable plan funds at accelerated
intervals.
The total replacement cost of the existing SH and MDR network is broadly
assessed to be as under: (in Rs. Crore)

State Highways 1,50,000


Major District Roads 1,00,000
Total 2,50,000
• Source: Road Development Plan Vision: 2021, of the Ministry of Shipping, Road Transport & Highways, published by the IRC. Cost based
on 2000-01 Prices)

Constraints Faced:

Ø Lack of finances
Ø Spreading resources thinly
Ø Control on pre-construction activities
Ø Weak management by contractors
Formation of Core Network
• It identifies major arterial routes covering national highways and those state
highways/major district roads which are either already experiencing high volumes
of traffic or have such potential in the light of industrial and other growth
strategies by both the public and the private sector.
• The Core network should have a corridor concept and it should be possible to
reach from one end of the State to the other at an average speed of 70-80 km per
hour.
• The objective should be that a commercial vehicle can cover 500 to 600 km on
such a network in one day.
• The core network would include the Expressways, four-laned roads, strengthened
pavements and pavements with good riding quality, bypasses and bridges

Core network length for all 71500 km


states
Financial Outlay covering all Rs. 80,000 crore
states
Highway Maintenance:
The requirement of funds as per the norms and fund provided during the last five
years are indicated below: -
3000

2500

2000
Requirement as per norms (in Rs.
1500 Crore)
Amount Provided (in Rs. Crore)
1000

500

0
2002-2003 2003-2004 2004-2005 2005-2006 2006-2007

Fund Requirement for maintenance


It is estimated that the fund requirement for maintenance of National Highways
during the 11th Plan period would be Rs. 11,400 crore.
Finance Commission’s Recommendations
The Finance Commission decided to provide an annual central grant of Rs.3,750
crore over the period 2006-10 for the country as a whole.
This amount is in addition to the normal expenditure, which the states are
expected to incur on maintenance of roads and bridges.
DEVELOPMENT OF ROADS IN THE NORTH-EASTERN REGION
• The share of road transport would be well over 90% in the total movement by
surface transport in the Region.
• The total road network now stands at 102,000 km out of which 7% are National
Highways comprising the Primary road system, 20% are State Highways and Major
District Roads comprising the Secondary road system and rest are Rural Roads
providing links to villages.
Road Network in NORTH-EASTERN Region
State National State Major Good Fair Poor
Highways Highways District
Roads
Arunachal Pradesh 392 119 4045 - 4.5 95.5

Assam 2836 1474 6280 12.8 57.3 29.9


Manipur 959 675 964 4.7 35.2 60.1
Meghalaya 810 653 2712 27.0 42.3 30.7
Mizoram 927 181 1176 - 29.5 70.5
Nagaland 494 637 669 12.4 45.3 42.3
Sikkim 62 186 464 NA NA NA
Tripura 400 - 454 - 64.4 35.6
Total for NE states 6,880 3925 16,764 10.7 40.9 48.4
Special Accelerated Road Development Programme in the North-Eastern
Region (SARDP-NE)

Objective:
• To provide connectivity to all the 85 District Headquarters of the NE Region.
• Covers 7616 kms of National Highways, State Highways and GS (General Staff)
roads
• To connect all State capital with improved/upgraded National Highways.
• To improve connectivity to the neighbouring countries.

The programme is to be implemented in two phases:


Phase ‘A’ Phase ‘B’
It covers 17 roads with an aggregate It comprises 83 roads with an aggregate
length of 1310 km. length of 6306 km.

Estimated cost is Rs. 4618 crore Time-frame, cost estimates, sources of


funds and the implementation agencies
The target for completion of roads under are, yet to be decided.
this Phase is year 2008-09
National Expressways

Ø Target: 15,766 km.


Ø Phasing of expressway: 2012, 2017, 2022
Ø Project Cost estimation: >> Rs.2, 50,000 crore.
Ø Plan for Phase I: 3,530 km (Report from Yahoo News 9th Dec ’09)
Ø Estimated Cost for Phase I: Rs. 20,000 crore.
Ø The Ministry of Road Transport and Highways has identified 11 stretches in 12 states in the
country for setting up high-speed six- to eight-lane expressways in the country in the first
phase of its plan.
Ø The states identified for the first phase include

Himachal Madhya Uttar Pradesh Karnataka


Pradesh Pradesh
Rajasthan Tamil Nadu Andhra Maharashtra
Pradesh

Gujarat Karnataka Kerala Goa


Ports - Review of 10th Five Year Plan
Target:
• Aggregate capacity of 12 major airports to hit 508.6 MTPA by
end of 10th 5 YP as against 343.95 MTPA by the end of 9th 5 YP
Finance Outlay:
• Total plan outlay: Rs. 5418.29 crore
• Gross budgetary support: Rs. 972 crore
• Internal and external resource generation: Rs. 4446.29
Major Ports (in million tonnes)
Cargo
500 Handled
450 (in million
400
Year tonnes) Growth
350
300
250
2002-03 313.55
2002-03
200
150
2003-04 2003-04 344.8 9.97%
100 2004-05
50 2005-06
2004-05 383.75 11.30%
0
2006-07 2005-06 423.57 10.38%

2006-07 465.7 9.95%

Minor Ports (in million tonnes) Cargo


Handled
(in million
180
160 Year tonnes) Growth
140
120 2002-03 108.3
100
80 2002-03
60
2003-04
2003-04 120.84 11.58%
40
20 2004-05
0 2004-05 137.87 14.09%
2005-06
2006-07 2005-06 151.14 9.63%

2006-07 170 12.48%


Capacity Creation and Utilization at Major Ports
600

500
Average Capacity
400 Utilization is about
300 Traffic Handled (in million
91.65%
tonnes)
200 Capacity (in million tonnes)

100

0 Average Growth in
traffic is 9.33%

Comparison of Traffic at Major and Minor Ports


700
Year Overall Traffic
600
2000-01 367.83
500

400
2001-02 383.97
Major Ports
300 2002-03 421.87
Minor Ports
200 2003-04 465.64
100
2004-05 521.62
0
2000-01 2001-02 2002-03 2003-04 2004-05 2005-06 2005-06 574.71
Private Sector Participation in Major Ports:
v Schemes estimated to be about Rs. 11,257 crore were identified

No. of Cost (Rs. Capacity Addition (million


Schemes Crore) tonnes)
8 Schemes 1775 44.4
Completed
6 Schemes 3818 45.5
awarded

Other Major Initiatives:

Ø Maritime Policy:
Seeks to combine vision and strategy for the sector through harmonious and coordinated
development of maritime assets like:
a. Ports
b. Shipping
c. Inland water transport system
d. Ship building
e. Ship repair industries
After firming up the revised draft and its clearance by COS, it has been placed before the
cabinet for approval
NMDP (National Maritime Development Programme):

Objective:
• Upgrade and modernize the port infrastructure in India and benchmark its
performance against global standards.
• Total investment for the programme is Rs. 1, 00,339 crore and out of them about
Rs. 34505 crore is expected from the private sector.
Allocation Rs. 55,804 crore for port sector .
Rs. 44,535 crore for shipping and inland water
transport sectors.
Target To be completed in phases within 2011-12.
No. of Projects 276

Projects Cover Construction / up gradation of birth, Deepening of channels, Rail / road


connectivity projects, Equipment up gradation and modernization scheme,
Other related schemes for creation of backup facilities.
Outlook 11th Five Year Plan
Availability of funds – Split Up (Rs. Crore)

Total : Rs. 68,972.16


• Internal crore
Resources ,
14502.08
Private • Gross
Sector , Budgetary
36868.24 support ,
5547.76

• Extra
Budgetary
Resource ,
12054.08

Ø Drafted with the expectation that GDP growth rate will be in the range to 8%-9%
during the 11th five year plan.
Projections for 2012: Projected Traffic Projected Capacity
Major ports 800 MT 1001.8 MT
Minor ports 300 MT 345.19 MT

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