In a major push to give a boost to the country’s infrastructure sector, the union cabinet has approved huge investment of Rs 30,835.86 crore for Railway and National highway projects across the country. The cabinet approved nine railway projects totaling 1,937.38 km and 1120 km of highway projects in five states.
The cabinet has given its green signal to nine railway projects in ten states worth Rs 24,374.86 crore include Assam, Jharkhand, Chhattisgarh, Maharashtra, Uttar Pradesh, Madhya Pradesh, Telangana, Andhra Pradesh, Odisha and Chhattisgarh and five national highway projects worth Rs. 6,461 crore in Karnataka, Odisha, Bihar, Rajasthan and West Bengal.
The news brings cheers on the face of construction equipment manufacturers and will give major boost to Indian construction equipment market, which has already started witnessing the better sell as compared to one year ago, all the leading manufacturers are bullish on better sales of various types of CE and material handling products.
In the budget 2016-17, government has committed to invest Rs 2.21 trillion for various infrastructure developments in current fiscal and allocated a mammoth Rs.218,000 crore for lone railways and roads in 2016-17.
When we look at the projects approved by union cabinet, Major railway projects fall under Maharashtra, Madhya Pradesh, Uttar Pradesh and Chhattisgarh, in these states Maharashtra alone received three railway projects. The cabinet approved construction of third line between Itarsi and Nagpur (Madhya Pradesh and Maharashtra) at cost of Rs.2,882.95 crore, this 280 km long railway line is expected to be completed in five years.
Another project which goes to Maharashtra is 201.04km long third line between Ballarshah and Kazipet (Telangana and Maharashtra) at a cost of Rs 2,403.22 crore and which is to be completed in five years and third project in the state, 228.3 km long third line between Rajnandgaon-Nagpur (Kalumna) in Rajnandgaon district of Chhattisgarh and Gondia, Bhandara and Nagpur districts in Maharashtra at a cost of Rs 2,193.53 crore, besides facilitating the travel, this project will benefit various industries, mines, coal fields and power plants will have additional transport capacity to meet their requirements.
In Uttar Pradesh and Madhya Pradesh, railway will construct 152.57 km long third line between Jhansi and Bina at a cost of Rs 2,273.84 crore, the project is expected to be completed in four years and another 273.80 km long third line between Mathura and Jhansi at a cost of Rs. 4,377.13 crore has been approved.
A 206 km long fourth line between Jharsuguda and Bilaspur will be constructed between Odisha and Chhattisgarh at a cost of Rs.2,298.31 crore and it will be completed in five years.
One railway project will be constructed in Andhra Pradesh at an estimated cost of Rs.3,875.68 crore, Indian railways will construct 287.67 km third line between Vijaywada Junction and Gudur Junction, the project is likely to be completed in six years.
One each railway project will take place in Assam and Jharkhand, 176 km second railway line between New Bongaigaon and Kamakhya at a cost of Rs 2586.85 crore will be constructed in Assam and third line between Kharagpur (Nimpura) and Adityapur at a cost of Rs 1483.36 crore will be built in Jharkhand.
Road Transport and Highways Ministry aims to increase the national highways’ length to 2 lakh km. This fiscal, government had decided to award 25,000 km of national highways as compared to 10,000 km in the last financial year and targets to construct 15,000 km in this fiscal.
The government commitment towards improving infrastructure of the country will drive overall construction equipment market and especially, multi-purpose equipment like Backhoe loader, excavator, various road building equipment and other.
States where government has approved railways and highways projects, will require a good amount of CE. By looking at government investment, infrastructure companies would think to increase existing number of their assets to grab the projects.