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The minister flew in here from Bangalore this afternoon and reviewed the problems of 28 stalled projects involving a total investment of Rs 92,500 crore.
In a two-hour-long meeting, Chidambaram interacted with a group of top executives and promoters of companies in the infrastructure sector, including GVK and Lanco, while asking them the reasons that were responsible for this delay.
The list of stalled projects is obviously dominated by the energy sector with 16 power projects with investments ranging from Rs 6,000 crore to Rs 7,000 crore. The remaining 12 are the road projects with a size of Rs 1000 crore to Rs 3,000 crore.
Problems relating to natural gas allocation, conclusion of fuel supply agreements with Coal India Limited and conclusion of power purchase agreements with the respective state power utilities were cited as the major bottlenecks in the power sector by the developers. For the road projects, the issue of land acquisition was cited as the single biggest reason for the delay in execution.
"Except for a few issues related to environmental clearances rest all fall into the above category of problems responsible for the delay," BA Prabhakar, chairman and managing director of Andhra Bank, said while briefing about the meeting. In a couple of cases, funding got delayed because of the compliance issues and disbursement of loans to these projects was never an issue, according to him.
While the Finance Minister has promised to take it up with the respective departments, a separate cell would also be created in the ministry to see that these issues are resolved because some of the problems reported in the meeting might take a longer time to resolve.
The banks have committed a total funding of about Rs 69,000 crore to these projects of which, 35-40 % had already been disbursed, Prabhakar said.
After the meeting, chief minister N Kiran Kumar Reddy paid a visit to the finance minister at the hotel where the event was hosted.
