Boost to CE Demand: Soon Work to Start on Mumbai Trans Harbour Link Project as JICA Clears Rs 7,910 Cr.

Soon the huge amount of construction equipment would require for the construction of Rs 17,750 crore Mumbai Trans Harbour Link (MTHL) project, as the work on India’s longest sea bridge project would soon hit the ground as Japan International Cooperation Agency (JICA) has recently cleared the first tranche of Rs. 7,910 crore, which is about 45% of the total cost of the project.

On 31st March, Japan International Cooperation Agency (JICA) and the Mumbai Metropolitan Region Development Authority (MMRDA) signed an agreement, in New Delhi, for the disbursement of the first tranche of Rs. 7,910 crore for MTHL project. The JICA has agreed to fund 85% of the total project cost of Rs. 17,843 crore.

The agreement was signed by Mr. Sakamoto, Chief Representative of JICA and Mr. U.P.S. Madan, Metropolitan Commissioner, MMRDA. The MMRDA is the nodal agency for implementing this project.

The consortium of AECOM-DAR-PADECO-T.Y. Lin have been appointed as general consultants for the project in which JICA has committed to fund 85% of the cost.

While commenting the loan agreement, Mr. Madan said, “This is a big boost to the Mumbai Trans Harbour Link as we have already shortlisted contractors, who have been issued Request for Proposal for the execution of the project.”

The MMRDA had invited tenders for the MTHL project and already shortlisted consortium of contractors for its three different packages. This 22km MTHL project is divided into 3 packages, the first two packages comprise the construction of 16.5km sea bridge component and a package for 5.5km long portions on land.

The authority shortlisted 7 consortium companies each for first two packages and 15 for the third package.

The last date for submitting the RFP (Request for Proposal) documents was April 5, 2017, the names of the final bidders are expected by the end of April or in May. The work on this project will kick-off soon after the final bidders will be selected, as the required fund is already cleared by the international investment banker JICA.

As JICA agreed to fund 85% of the MTHL project, the rest 15% fund for the project is to be managed by the state government, In MMRDA Budget-2017-18, the provision of Rs. 1,200-crore has paved way for the speedy implementation of this project.

The 22km-long Sea Bridge will be a six-lane (three lanes each way) with a width of 27 metres, will connect Sewri in Mumbai with Nhava in Navi Mumbai. The MTHL Project will give easy and fast connectivity between Navi Mumbai and Mumbai, International airport in Navi Mumbai, and provide the convenient gateway to Pune Expressway and further to Southern India.

This large infrastructure project would further generate the demand for various types of construction equipment in the Mumbai region. Heavy equipment like Excavators, bulldozers, asphalt mixers, different types of cranes, material handling equipment, fabrication equipment, Backhoe loaders, Motor graders, and others will see the demand during the construction period. The project will give a boost to both CE and rental market in the region.

The project is expected to be completed by 2021.

Source: Information has been obtained from MMRDA, JICA

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Another Boost To CE Industry, Cabinet Approves Rs 4500 Crore To Revive 50 Regional Airports

The Union cabinet on Monday has approved a proposal to spend Rs 4,500 crore for the revival and development of 50 un-served or under-served airports and airstrips in the country. The move would boost the Indian aviation sector and increase the regional connectivity.
As per the official statement, around 15 airports or airstrips will be revived during financial year 2017-18 and 2018-19 each, while remaining 20 airports or airstrips would be revived during FY2019-20.
The revival of these un-served or under-served airports and airstrips will connect small cities or towns on commencement of the operation of flights. The move will further boost the economic development in these areas and also create employments and related infrastructure in the surrounding areas.
“The Revival of airstrips/airports will be ‘demand driven’, depending upon firm commitment from airline operators as well as from the State Governments for providing various concessions as Airports will be developed without insisting on financial viability,” said the government in a statement.
During Union Budget 2016-17 Finance Minister Mr. Arun Jaitley had announced for making adequate provisions for revival of un-served and underserved airports in the country.
The huge investment of Rs 4,500 crore would further boost the Indian construction equipment industry, which is entirely depends on the infrastructure investment in the country, thus the CE manufacturers will continue to witness the remarkable sales growth for another year. Last year, as a result of the investment in infrastructure projects, especially in road sectors, the demand of construction equipment grew after a gap of four years.
The government had already announced the investment of Rs 3.96 lakh crore in the budget 2017-18 for the development and modernizations of roads, railways and ports sector. The government is committed to spread new railways lines of 3,500 km and allocated Rs 64,900 crore for the development of highways in the next fiscal, the investment would further drive the sales of road building equipment in 2017 after remarkable sales growth in 2016.
In budget 2017-18, the government alone allocated Rs 2.41 lakh crore for the transportation sector. The Indian government is mainly betting to improve urban transport infrastructure to meet the need of rising urban population in the country. Currently, various Metro rail projects are under way in cities Like Mumbai, Pune, Nagpur, Hyderabad, Chennai, Lucknow, Ahmedabad, Kochi, Kanpur, Noida, Navi Mumbai and others and other metro rail projects are under the planning stage.
Various research reports are also optimistic for the Indian construction equipment market and project positive sales growth on the back of government investment in infrastructure projects.

These Reasons Hold Value in Used Construction Equipment

The used construction equipment market is quite promising ahead in India as many people started realizing the need of using second-hand construction equipment in order to reduce their project cost.  The used construction machinery is having various other advantages which considered at the time of purchase.

The prime reason to prefer used machine is pricing. Contractors purchase the second-hand machines only to reduce their overall project costs. The other benefits which can consider at the planning stage are as follows:

Avoid depreciation
When you buy the used construction equipment means you are buying it in depreciated value. Usually, the price of construction machinery can depreciate around 20 to 40 percent in the very first year depending on the condition of the machine. As you have purchased the machine in depreciated value, its resale value will hold for a longer period and potential loss in selling used equipment is less compared to selling new equipment.
Maintenance holds value for long
As we said above, the potential loss in selling used equipment is less compared to selling new equipment. The real value of any used construction machinery entirely depends on its maintenance. As long as we maintain it, the resale value of your machine will be high and anytime in the near future, it can be sold to price close to it was purchased.
Technology Concern
Many construction equipment manufacturers started coming up with machines with the latest technology. However, it is one of the facts that technology in heavy construction equipment does not change rapidly, so there is no issue or any disadvantage of using three to four years old machines for the project.
Low cost of ownership
With the purchase of the used construction machine, you can be the owner of the machine at a low cost. Many contractors require the specific equipment for specialized work on the site, in that condition owner can manage to purchase the second-hand machine at a low price and it also gives the flexibility to upload it after the use without any major loss.

Avoid long order with new
Many times, people have a long waiting list when looking for a certain type of new heavy construction equipment. But construction projects always get delayed due to various other reasons. Thus, contractors do not want to wait for long for the delivery of the new machine, and it can be fulfilled with the purchase of the second-hand machine.  With the emergence of online portals like www.equipmentonestop.com, the buying any types of used construction machine in India has become quite easy.