The Government today said that it would set up a road regulatory authority in 2013-14 to address the financial stress, construction risk and contract management in the road sector.
“Challenges not envisaged earlier including, financial stress, enhanced construction risk and contract management issues, are best addressed by an independent authority...hence the government has decided to constitute a regulatory authority for the road sector,” Finance Minister P. Chidambaram said while announcing the Budget.
The proposal to set up a regulatory authority in the road sector has been in the offing for some time. The Ministry of Road Transport and Highways, earlier this month, had asked the government to re-examine the proposal.
This move may also be linked to the recent trend of some private companies exiting projects on account of delay in various clearances.
At present, the National Highways Authority of India along with the Road Ministry awards projects.
Key functions
The key functions of the proposed regulator are likely to include tariff setting, regulation of service quality, assessment of concessionaire claims, collection and dissemination of sector information, service-level benchmarks and monitoring the compliance of concession agreements.
The proposal would go to the Cabinet for approval. Overall, it is estimated that the infrastructure sector will need an investment of $1 trillion (about Rs 55 lakh crore) in the 12th Five-Year Plan period (2012-17).