Secretaries panel to ensure infra projects stay out of courts

The Prime Minister told his Cabinet colleagues that about 215 projects with investment of over Rs 2 lakh crore are hanging fire as they are stuck in inter-ministerial issues, an official who attended the meeting said. 

Singh was told that by finance ministry officials that projects in power and highways sector have been hit as delayed clearances have raised costs. A primary reason for the delays are disputes among ministries.

The Prime Minister directed that the empowered group of officers will be formed under the Cabinet Secretariat where the Secretaries of the concerned ministries would be included to resolve the inter-ministerial disputes at the ground level so that before taking them to the Cabinet Committee on Investment,they are made hassle free, the official said.

The PM was keen to revive growth of the core sector and one of the way he argued was to strengthen the dispute resolution mechanism for public private partnership projects (PPP). The official said investments worth nearly Rs 36,000 crore in the power projects could come unstuck for want of green clearances,lack of coal supply and land acquisition issues. The PMs intervention in reviving the infrastructure projects comes barely days after a chiefs of infrastructure companies approached his office to institutionalise a mechanism help the developers cope up with unforeseen risks

The group will work to prevent disputes clouding projects to become court cases. The meeting stressed on having an institutionalised mechanism after incorporating the lessons learnt form various existing dispute settlement forums to minimise litigations, the official said.

Finance ministry officials suggested that the private sector needs to be re-assured that their contractual rights would be honoured. In the absence of a strong dispute resolution system,the percentage of PPP projects becoming court cases have begun to rise creating a fresh obstacle point for the developers and again blocking capital.