Gadkari favours 51% stake to foreign firms in JVs for tunnel construction

PTI, Sep 3, 2024, 6:13 PM IST

Road Transport and Highways Minister Nitin Gadkari on Tuesday favoured giving a majority 51 per cent stake to foreign partners in joint ventures for building tunnels and detailed project reports to improve work quality.

Gadkari said providing a majority stake to a foreign partner in the joint venture is necessary to ensure that only serious and technically qualified players bid for tunnel projects.

In a lighter vein, Gadkari said that in some tunnel projects, European companies even choose Indian partners who own caterer services or beauty parlours.

“I seriously feel that foreign partners must have 51 per cent stake, leaving 49 per cent for the Indian companies in JV for building DPR and construction of tunnels, to ensure that work is done properly,” the minister said at an event here.

Gadkari, known for his candid views, further said although the technical and financial parameters should be liberal, these should not be at the cost of quality.

“I probably should not be using the word ‘culprit’ but I will.

“DPR makers are the ‘culprits’ for their lack of oversight during the process of constructing tunnels, which often leads to landslides, that are increasing in India annually,” he said.

The minister said a permanent solution is needed to address frequent landslides in Uttarakhand and other Himalayan areas.

The minister also stressed that logistics costs should be reduced to boost exports. “If we can reduce our logistics cost to 9 per cent then our exports will increase by 1.5 times,” he said.

According to quick estimates by think tank National Council of Applied Economic Research (NCAER), the logistics cost in India ranged from 7.8 per cent to 8.9 per cent of GDP in 2021-22.

Gadkari also said that the government has completed 35 tunnels spanning 49 kilometres at the cost of Rs 15,000 crore. Currently, 69 tunnel projects covering 134 kilometres are under construction, with an estimated investment of Rs 40,000 crore rupees.

“Looking ahead, plans are in place for an additional 74 tunnels stretching 273 kilometres, projected to cost Rs 100,000 crore,” he said.

Gadkari underlined technology upgradation and cost-effective solutions to tackle the unique challenges of India’s diverse terrain while maintaining high-quality standards.

The minister highlighted the need for terrain-specific approaches, particularly in the challenging Himalayan regions.

He called for innovative solutions, such as precast technology and push-back techniques, to address recurring issues like landslides.

The minister also discussed innovative cost-saving measures, including potentially reusing materials excavated during tunnel construction. The minister wondered if the material that comes out from there be reused in road construction and cut costs.