The government will set up a transport department, which will tie up with green funds and aid in converting buses into bio-diesel-, bio-ethanol-, electric- and CNG (compressed natural gas)-run vehicles, Union transport minister Nitin Gadkari said, while outlining the major focus areas of his ministry at the “Infra Ministerial” event organized by CNBC TV 18 and Mint in New Delhi on 21 March. Edited excerpts of his address:
On the National Democratic Alliance (NDA) government’s delay in addressing the agrarian crisis:
Your question is appropriate but not for the appropriate person. But I will give you the answer because for the past 15 years, I have been working in the rural area and I am related with a lot of rural development projects. Irrigation is key to success (in the agriculture sector). For the first time, our (NDA) government started the Pradhan Mantri Krishi Sinchai Yojana with Rs.20,000 crore. Irrigation in our country is 46%, the lowest being in Jharkhand.
Secondly, they need 24-hour power supply, next they need seeds, fertilizer and capital. This is the first time a provision of Rs.9 lakh crore was made in the budget for agriculture and crop financing. And Rs.15,000 crore is to give interest subsidy for that. Our government is giving priority to the agriculture sector and in two-three years time, we will get good results. We have already decided that by 2022, there will be a two-time increase in agri-production. I think that by increasing irrigation under Pradhan Mantri Krishi Sinchai Yojana and giving Rs.80,000 crore to stalled (irrigation) projects in the next four years, we feel we will be in a position to increase irrigation in the country and increase production by two times.
On ending permit raj in the states:
It is a difficult task and it is difficult to give a timeline. But the idea behind it is that already all state transport services are incurring great losses. We have formed a new transport department. Our decision is to convert our buses into bio-diesel, bio-ethanol, electric, CNG (compressed natural gas) by which we can reduce the (fuel bill) cost. By using electric buses, we can reduce the cost by 50%. We have discussed with the green funds. We have decided to convert buses into bio-diesel, bio CNG, electric and ethanol. So the new department—for which a note is pending with the cabinet—after getting the approval from it, we will form the department with a new secretary. We will look at tying up with green funds and that fund can be available with the different state corporations.
On introduction of private sector in passenger segment:
Regarding privatization in the transport sector, our idea is to improve the buses available with technology. At the same time, for extra capacity, we can encourage the public-private partnership (PPP) mode and many people can start and give good service. But this is a subject in a concurrent list. So, this is not a central subject. The centre can give financial assistance to a state. In some places, we have bus ports, we can extend help to state governments to create bus ports.
On challenges for BS-VI emission standards
No; it’s not a problem with the state governments. We have taken a decision after consulting with the petroleum ministry and the environment ministry. And 1 April 2020, we are going to make mandatory the Euro VI standards. The problem is with the petroleum ministry because we need the fuel of that standard, so they have a programme ofRs.80,000 crore that is for capital cost for changing equipment in their refineries to make available petrol and diesel of Euro VI standards. I am trying to do this as early as possible; I have told the petroleum ministry that if you cannot supply this fuel in the metros, I can get this fuel from the private sector. But the petroleum minister has assured me that before one year is up, he will make available fuel of Euro VI standards in the country.
On availability of long-term funding for infra projects:
Regarding the highway sector, we have given a new option to the investor. It is the hybrid model. We will acquire the land. Without acquiring 80% of land, we cannot give any acceptance letter. Land acquisition and environment clearance will be the responsibility of the government and we will give the concessionaire a part of the total cost of the project as grant-in-aid subsidy, and the rest he has to invest. Out of that, the creation of a 30% equity is his responsibility. Today, we have 27 projects in hybrid mode. So, today, this is a successful formula and we are working on it. If the cost of a project is Rs.1,000 crore, then Rs.400 crore we are giving as grant-in-aid and Rs.600 crore he has to take from the bank and he has to invest. Out of Rs.600 crore, 30% he should have equity, which comes to Rs.180 crore. Even today, the situation of Indian contractor-investors is not good. He does not have Rs.180 crore to invest. So our idea is—we need to take permission from the cabinet—that we will give him 10% equity of the project cost. So this can be a good, attractive idea for the investors.