Cabinet Approves Railway Infra Projects Worth Rs 10,739 Crore

Cabinet Committee on Economic Affairs (CCEA) has approved the railway projects worth Rs 10,739 crore to improve and enhance the existing Indian railway infrastructure in various Indian states including Maharashtra, Uttar Pradesh and Gujarat on Wednesday. The meeting was chaired by the Prime Minister Mr. Narendra Modi.

The Cabinet has approved doubling three existing railway lines for 763 km and laying down two third rail lines for 514 km in some important railway routes in the country.

Union Railway Minister Mr. Suresh Prabhu said “The benefit of these projects obviously will go to several states but two important states will benefit immensely, one is Gujarat and the other is Uttar Pradesh.”

Cabinet approval has given to doubling of Pune-Miraj-Londa railway line project at an estimated cost of Rs.3, 627.47 crore and expected completion cost of Rs.4, 246.84 crore with 5% escalation per annum. The length of the railway line will be 467 km. The completion period of the project will be five years.

Doubling of this line will greatly ease the ever increasing freight traffic between Pune-Miraj-Londa section, thereby increasing the revenue of Railways, said the government.
The another approval has given to doubling of Surendranagar-Rajkot project at an estimated cost of Rs.1,002.39 crore with expected completion cost of Rs.1,137.17 crore with 5% escalation per annum.

The length of the railway line will be 116.17 km. The completion period of the project will be four years.

Railway ministry says doubling of this line will greatly ease the ever increasing freight traffic between Okha-Rajkot, Porbandar-Kanalus, Veraval-Rajkot and Maliya Maiyana / Navalakhi-Dahinsara-Wankaner section.

The CCEA has also given its approval to doubling Roza -Sitapur Cantt.- Burhwal Broad Gauge single line project at an estimated cost of Rs.1,295.42 crore with expected completion cost of Rs.1,486.46 crore with 5% escalation per annum.

The length of this railway line will be 180.77 km. The completion period of the project will be five years.
Apart from giving approval for doubling three line projects, CCEA has also given its approval for taking up two third line projects between Vizianagaram and Titlagarh at an estimated cost of Rs.2,335.68 crore and Bina-Katni project at an estimated cost of Rs.2,478.23 crore.

The length of the railway line between Vizianagaram and Titlagarh will be 264.6 km and length for Bina-Katni will be 278.7 km long, both the projects are expected to be completed in five years.

Source: Information has been obtained from government press note, PTI


To Promote Planned Development, States Asked to Convert Urban Areas into Statutory ULBs

To promote planned urban development in the country, Ministry of Urban Development has asked 28 States to take immediate and necessary action to convert 3,784 Census Towns into statutory Urban Local Bodies.

Through urban local bodies, central government aimed planned and coordinated infrastructure development in these towns to enhance revenues and efficient delivery of services to citizens leading to the overall growth of economic activities.

Mr. Rajiv Gauba, Secretary of Urban Development said, “The opportunity of planned urban development might get lost if unplanned construction and ad hoc provisioning of infrastructure is allowed to take place over a long time”.

The latest United Nations report says, India is projected to add 300 million new urban populations by 2050, which indicate country need planned and organised urban development to adjust rising urban population.

Government explains, a census town is an area with urban characteristics like a minimum population of 5,000, at least 75% of the male main working force engaged in non-agricultural activities and population density of at least 400 persons per As per 2011 Census, there are 3,784 Census Towns as against 1,362 in 2001.

As per the guidelines of the 14th Finance Commission, converting Census towns into statutory ULBs entitle to get central assistance.

State-wise distribution of Census Towns are: West Bengal-780, Kerala-461, Tamil Nadu-376, Maharashtra-279, Uttar Pradesh-267, Andhra Pradesh and Telangana-228, Jharkhand-188, Gujarat-153, Karnataka-127, Assam-126, Odisha-116, Madhya Pradesh-112, Rajasthan-112, Punjab-74, Haryana-14, Bihar-60, Goa-56, Uttarakhand-42, Jammu & Kashmir-36, Tripura-26, Manipur-23, Chattisgarh-14, Meghlaya-12, Nagaland-7, Himachal Pradesh-3, Arunachal Pradesh-1 and Mizoram-0.

This organised development would change the entire infrastructure of these 3,784 towns and will provide the necessary basic amenities to the people. Along with planned housing construction, it will also lead to the organised retail market and shopping malls in these cities in the future.

As per the report of UN on increasing urban population of India, these towns will also turn the big market place for big real estate companies who generally invest in tier-I and tier-II cities.

When there is infrastructure development, there is scope for various sectors which directly or indirectly dependent on development, one of the sectors is construction equipment, which plays a pivotal role in infra development.

As development kick-off in these towns, it is expected that huge number of construction machineries will be required and sell of the construction equipment will rise, which indicate positive sign for the construction equipment manufacturers.

Source: Information has been obtained from government press note

Demand of Road Construction Equipment is Expected to Rise in This Fiscal

As government claimed, it has addressed most of the hurdles for constructing highways, would help companies and authorities to speed up the highway construction work in the country and meet the government target to increase national highways length to 2 lakh km by the end of this financial year.

Recently Road Transport and Highways Minister, Mr. Nitin Gadkari said, “We have addressed most of the problems like land acquisition and delays in forest and environment clearances… Now, it is expected that work in the highways sector will gain pace of expressways, we have potential to do work worth Rs 25 lakh crore”.

As government will increase its pace to construct highways, the huge amount of road construction equipment will be required to construct these highways, which is the good news for such manufacturers which manufacture equipment used for road construction.

Road Transport and Highways Ministry has decided to increase the national highways length to 2 lakh km by the end of 2016-17 which is now touched 1.55 lakh km from 97,000 km when this government came into power, claimed Mr. Gadkari.

The government has executed projects worth Rs 2.5 lakh crore during this period.

Recently Mr. Gadkari had announced that government would invest Rs 25 lakh crore in roads, ports and shipping sector, which would obliviously help the construction equipment market of the country as huge infrastructure development take place, the demand of construction equipment will climb.

In this financial year (2016-17) ministry has decided to construct 41 km of national highways per day from current nearly 16 km of per day.

This fiscal, government had decided to award 25,000 km of national highways as compared to 10,000 km in the last financial year. Last financial year, actual 6,000 km of highways had been constructed, which is nearly 36% of jump on year-on-year basis, claimed the ministry. Now government has raised the construction target of 15,000 km for this fiscal.

This is the harbinger of further growth in road construction sector.

As huge construction will take place in highways sector, especially equipment used for road and highways construction will be needed in huge number to construct these national highways in the ongoing financial year.

As we know road construction completes in three stages, these are rough grading, fine grading and surfacing, to complete these three phases of work three types of equipment will be required like Earthmoving machine, Road works machine and Lifting machine.

Equipment like Excavators, Loaders, Dozers, Graders, Scrapers, Asphalt mixing machines, Paver, Compactor, Cranes, Forklift Trucks, Concrete Plants, Redi-mix trucks, rollers and others will be in demand for the construction of road and highways.

Source: Information has been obtained from Government press note, PTI, Live Mint and Business Line

Why Your Backhoe Loader has Multiple Advantages

This multipurpose equipment is known by multiple names in the industry, The Backhoe loader is also popular as digger or simply backhoe at construction equipment market.

This unique construction equipment has combination of three tools and each tool associated with this machine has a different function at construction sites, so we can call it one machine with multiple advantages.

This machine has versatile uses like, small demolition, digging holes, paving roads, breaking asphalt, laying pipes, setting up drainage system, transport heavy items, it is capable enough to perform various other tasks.

There are other machines in the market which do the same sort of work, but many developers use backhoe loader because of its varied usage. It is handy as compared to excavator and can move around all construction sites and even easily brought on the road.

If you have small and medium projects, then this equipment is best and cheap in rate as compared to other machine for the same sort of work.

This machine has a history of over 60 year, but still survives in the market across the world, despite new equipment introduced in the construction market.

So buying this equipment will never land you in loss as it can be used for various other works, Backhoe loader is also used for agriculture, even there is no project in hand it can be used for agriculture work.

To buy this equipment one can certainly contact with dealers of leading manufacturers like JCB India, Caterpillar, Tata Hitachi, Volvo, Mahindra and various other leading manufacturers in the country.

Further, you want to save more money and have limited budget, one can opt for good condition second hand or used backhoe loader from its owners, and there are various platform online and offline platform like, where you can find your desired equipment at a very decent price.

Government Approves 14 Greenfield Airports Across the Country

India, the World ninth largest civil aviation market has been betting strongly to improve and expand the country’s aviation infrastructure to meet the demand of rising air passengers.  The government has granted ‘in-principle’ approval to set up 14 Greenfield airports across the country; the civil aviation ministry has informed the parliament.

These Greenfield airports are; Mopa in Goa; Navi Mumbai, Shirdi and Sindhudurg in Maharashtra; Shimoga, Gulbarga, Hassan and Bijapur in Karnataka;  Kannur in Kerala;  Pakyong in Sikkim;  Datia/Gwalior (Cargo) in Madhya Pradesh;  Kushinagar in Uttar Pradesh;  Karaikal in Puducherry; and Dholera in Gujarat.

Government has also laid down Route Dispersal Guidelines (RDG) of air transport services taking into account the need for air transport services of different regions of the country, said the ministry.

The government initiatives to make air travel viable for its people and its decision to make new Greenfield airports, would take Indian aviation to the next level. It is projected that India will be the third largest aviation market by 2020.

Recently, Ministry of civil Aviation proposed  a subsidy to airlines by levying a 2% fee to reduce the cost of travel in non-metros routes and aiming to bring down the price nearly Rs 2,500 per flying hour under Regional Connectivity Scheme (RCS), which will surely boost the Indian aviation industry and  make air travel feasible.

Last month government announced that it has decided to develop 25 regional airports in the country this year. By keeping future requirement of the domestic airports, government is working hard to invest in aviation infrastructure.

Government expects India aviation sector is expected to see investment around USD 12.1 billion during 2012-17, USD 9.3 billion alone expected to come from the private sector.

Above mention Greenfield airport, 50 airports under the low-cost model and some Brownfield airports of Airports Authority of India are to be developed across the country, including Public Private Partnership (PPP).

India has planned to increase 250 operational airports by 2030 in the country.

To bring the foreign investment in the Indian aviation sector, government has given various relaxations and exemptions like; 100% FDI has been permitted to develop Greenfield projects under automatic route, up to 74% FDI is permitted for existing airport projects under automatic route, above 74% and up to 100% permitted under government approval route.

In recent time, Indian domestic air passengers’ growth has jumped by leaps and bounds; during January-March 2016 period, domestic airlines have carried 230.03 lakh passengers against 185.46 lakh, during the same period of previous year, registered 24.03% growth.

During January-December -2015 domestic airlines had carried 810.91 lakh passengers against 673.83 lakh during same period in 2014, registered 20.34% growth in 2015 as compared to previous year.

The huge demand and supply for this sector will obliviously help the infrastructure growth of the country, such infra growth would help construction equipment sector of the country as this industry entirely depend on the infra development.

Source: Information has been obtained from Government press release, Makeinindia, The Indian Express and DGCA.

Hyderabad Metro Rail Project Will Now Complete in December 2018

Hyderabad metro rail project deadline has got extended by 18 months, now it is likely to complete only by December 2018 due to various reasons; originally the deadline to complete this three phase metro project was fixed for July 2017.

“This is a linear project, hence all segments have to be completed for it to become operational. Even if 80 percent of the project is completed and 20 percent is remaining due to some hurdles, the Metro can’t operate. Hence completion is possible only after all aspects are in place,” said Mr. V B Gadgil MD & CEO of L&T Metro Rail Hyderabad Ltd.

This Rs 16,375 crore metro rail project is being constructed by L&T Metro Rail Hyderabad Ltd, which is the subsidiary of L&T Infrastructure Developments Project Ltd an infrastructure arm of Larsen & Toubro Ltd. L&T Metro Rail Hyderabad has to implement the Project on Design, Built, Finance Operate and Transfer (DBFOT) basis.

Hyderabad metro project is the largest fund tie-up in India for a non-power infrastructure Public Private Partnership (PPP) project.

Last year, L&T Metro Rail Hyderabad held a trial run on Stage-2 from Miyapur to Kukatpally Housing Board (KPHB) in May 2015 and test run between Miyapur and SR had held in October 2015.
Nagole to Mettuguda (Corridor III) and Miyapur to SR Nagar (Corridor I) even these two stretches will not be launched on June 2, 2016, which was expected to get clearance by May 31st. L&T Metro Rail Hyderabad informed the Telangana government that few departments need to clear some processes which required for getting railway safety certificate.

So far L&T Metro Rail Hyderabad has pumped around Rs 9,000 crore on this 72 km long elevated metro rail project, including Rs 2,700 crore from equity. This metro project is being financed by 30 percent equity and 70 percent by debt. A consortium of 10 banks led by State Bank of India has sanctioned the entire debt requirement of the project.

Delayed in the project will cause to change in the estimated project cost.

The L&T Metro Rail Hyderabad had signed the Concession Agreement with Government of Andhra Pradesh in September, 2010 and completed the financial closure for the Hyderabad metro project on 1st March, 2011; the project had commence in April 2012.

L&T Metro Rail Hyderabad has taken world class consultants services like Louis Berger, AECOM Feedback Ventures Consortium, Parsons Brinckerhoff, Halcrow, E&Y etc for the execution of Metro Rail Project.

Hyderabad Metro Rail Network will cover total 72 km distance for all three corridors, Corridor – I: Miyapur to LB Nagar, Corridor II: JBS to Falaknuma and Corridor III : Negole to Shilparamam.

The Metro Rail Network will pass through the major roads of Hyderabad which connects main bus hubs, commercial spots and residential areas. The bus depots that are being interlinked include Miyapur, MGBS, Koti, Dilshuknagar, Charminar and Jubilee Bus Station.

Hyderabad metro will be connected to MMTS services at Begumpet, Falaknuma, Bharatnagar and Malakpet along with prime train terminals at Secunderabad, Nampally and Begumpet.

Source: Information has been obtained from L&T Metro Rail, Business Line, Deccan Chronicle.

BMC to Build 7 Jetties to Construct Rs 12,000 crore Mumbai’s Coastal Road

Brihanmumbai Municipal Corporation (BMC) will build seven jetties in the Arabian Sea to bring the construction materials for the construction of coastal road project worth Rs 12,000 crore. The Civic body is expected to issue the first phase of work orders from 1st October to build this coastal road in Mumbai.

“Transporting the materials via roads would not be very efficient since the trucks will be able to travel only at night. Thus, a minimum of seven jetties will be constructed where materials, including granite and metal will be transported mainly from Alibagh and Navi Mumbai (New Bombay),” said Additional Municipal Commissioner Sanjay Mukherjee.

The 33.2 km long coastal road will be constructed from South Mumbai (Priyadarshini Park) to Kandivali to reduce the traffic congestion of financial capital of the country. This coastal road will have a combination of tunnels, elevated roads, flyovers, bridges and interchanges, it is said that once the project gets completed, it will be a kind of coastal road of Sydney and San Diego.

The project has been divided into seven sections and one jetty will be constructed for every section to bring construction materials from Alibaugh and Navi Mumbai to offload at jetties; however the locations for jetties have yet to be finalised.

Civic body official claims that building jetties will be feasible and quickest way for transporting the construction materials, as transportation of material by trucks would be only possible in the night.

BMC has already initiated the tendering process for the first phase of the project and will conduct a pre-tendering conference by next week where interested companies will have to submit their past projects in the conference. The civic body has released the expression of interest for the first phase of the project and allowed a joint venture of maximum three companies to avoid conflict of interest.

The qualifying criteria to get the project will be finalised after pre-bid conference. The project will be only awarded to the companies which will have prior experience in building flyovers, sea walls, highways and land reclamation.

Dutch and British governments have already shown their interest to cooperate and participate in the project. However, BMC has also received intimation of companies from China, South Korea, Netherlands, Japan and Belgium.

Last year in December, central government amended the Coastal Regulatory Zone notification-2011 to permit the Rs 12,000 crore coastal road project in Mumbai. On 30 December 2015, Ministry of Environment and Forests (MoEF) had finally given its green signal through a notification, which allows Maharashtra government to reclaim land for the construction coastal road project.
The project had to wait for 4 years to get environmental clearance.

Huge amount of steel, cement, granite and metal will be required for the construction of coastal road, the project will also require huge amount of heavy construction equipment.

Source: Information has been obtained from various media reports, like The Indian Express, HT, ET

Real Estate Sentiment Turns Positive in First Quarter of 2016, Future Optimistic Report

India’s real estate sector has witnessed the positive sentiment in the beginning of  2016, the Real Estate Sentiment Index has jumped in the first quarter of 2016 after the five slow quarters, said a report prepared by industry body FICCI and Knight Frank India.

The Real Estate Sentiment Index has climbed to 53 in January-March 2016 from 48 in the previous quarter of Q4 (October-December) 2015. The sentiment was at the speak at 63 in July-September quarter of 2014, since then it has been declining continuously in every quarter.

“After a lull of five quarters, the overall sentiment has experienced a sharp up tick at the back of the Union Budget’s focus on real estate and infrastructure. Additionally, the Real Estate (Regulation and Development) Bill becoming (became) an Act has boosted the sentiment further since the sector is expected to become much more transparent and organised which in turn will benefit all the stakeholders,” said  Dr Samantak Das, Chief Economist & National Director, Research, Knight Frank India.

Real Estate (Regulation and Development) Bill, 2016 became an Act from 1st May.

The future sentiment of real estate sector has also jumped to 67 during the January-March quarter, the future sentiment in previous the quarter was 58 in Q4 2015.

Overall, there is a considerable improvement in the sentiments for the residential sector. The number of respondents with a positive outlook for the sector has gone up in Q1 2016. The pressure on unsold inventory has been reducing since the last four quarters due to the limited number of new launches, said the report.

Developers have been focussing on project completions, instilling confidence in buyers.

The benefits provided to buyers in the Union Budget 2016 are also expected to push demand further. Stakeholders are quite optimistic about residential sales, nearly 54% of the respondents believe that the demand will pick up in the coming six months.

The stakeholders have been optimistic about the Office market for quite some time now and the same trend has been reflected in this survey as well. Residential sector, on the other hand, has restored positive sentiment amongst the developers and lenders for the first time after four quarters, said Mr. Das.

Stakeholders are quite optimistic about the office market, especially in terms of leasing volumes and rental appreciation. Nearly 73% of the respondents expect the leasing volume to improve in the coming six months.

In view of the limited office supply and firming leasing volumes, stakeholders are of the opinion that the office space rental appreciation rate will be better in the next six months.

The north zone witnessed a substantial recovery in the future sentiment score in Q1 2016, said the report.

As sentiment has risen in the first quarter and future sentiment of both residential and office market is expected to grow, the sentiment will positively impact on the construction equipment industry if more construction related works take place in the country.

As per the PTI report, Union Minister Mr. Nitin Gadkari said recently that the government is planning to invest Rs 25 lakh crore over the next 3 years for the construction of roads, railway and shipping infra. The investment indicates very strong sign for the construction equipment industry.

Source: Information has been obtained from FICCI and Knight Frank India report, PTI

Government Approves Rs 9,005 Crore Affordable Housing in Three States

Ministry of housing & urban poverty alleviation has approved an investment of Rs.9, 005 crore for the construction of houses for economically weaker sections in urban areas of three states- Maharashtra, Punjab and Jammu & Kashmir in a meeting last week.

The investment will be done under the Prime Minister’s Awas Yojana (PMAY) scheme of the central government of India and estimated to construct around 73,205 houses for economically weaker people in these three states for current fiscal.

These were also the first affordable housing proposals of these three States sanctioned under PMAY (Urban). An inter-ministerial Central Screening & Monitoring Committee has approved the housing proposals for current financial (2016-17) year.

With these approvals, the total investment approved for affordable housing under PMAY (Urban) has gone up to Rs.43, 922 crore for construction of 6, 83,724 houses for urban poor in the country. However, central government has committed to aid Rs.10, 050 crore for the scheme.

“Under the components of AHP (Affordable Housing in Partnership) and BLC (Beneficiary Led Construction) of PMAY (Urban), central assistance of Rs.1.50 lakh per house is provided while under In-situ Slum Redevelopment to be taken up by private developers through monetization of existing land, central assistance of Rs.1 lakh per house is provided,” said the ministry.

 Ministry has sanctioned to construct 71,701 homes in 10 cities of   Maharashtra with the project cost of Rs.8, 932 crore with central assistance of Rs.1, 064 crore. Houses sanctioned include 61,946 under affordable housing in partnership (AHP), 7,399 for beneficiary led construction (BLC) and 2,356 for In-situ Slum Redevelopment.

These 10 cities of Maharashtra have been chosen to construct 71,701 homes are – Virar-61,946, Kalyan-30,378, Thane-8,184, Gothegar-3,822 and the rest in Mumbai Metropolitan Region areas of Wave, Palghar, Pen, Nilaje Pada, Raygad and Kelawali.

Under the In-Situ Slum Redevelopment scheme, 1,280 houses will be constructed in Bhatinda, Punjab with total investment of Rs 57 crore, for which central government assistance of Rs.12.80 crore has been sanctioned.

Under Beneficiary Led Construction component of PMAY (Urban), centre has approved to construct 224 houses in Jammu & Kashmir with a total investment of Rs.16.07 crore with centre assistance of Rs 3.36 crore. This includes construction of 141 houses in Udhampur and 83 in Baramullah.

Under PMAY scheme, centre has committed to construct 2 crore houses for urban poor by 2022.

Such a huge investment in these three states will improve the construction sector and will impact positively on the industry which is dependent on this sector, like heavy construction equipment sector and cement, steel industry. All these three sectors did not perform well for last few years due to investment crunch and some other reasons.

Construction sector gives employment to highest number of people after agriculture in the country; therefore this investment would generate a huge amount of jobs to the people of Maharashtra, Punjab and Jammu & Kashmir.

Source: Information has been obtained from government press note.