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Mechanisation Imperative to Speed up Infrastructure Projects: Dr C P Joshi [24 November 2011]

“Mechanisation is imperative to speed up the implementation of India’s infrastructure projects,” Dr C P Joshi, Minister of Road Transport and Highways, Government of India, said and added that the growth of infrastructure sector is critical for the country to achieve a sustained economic growth in the next ten years.
Delivering the chief guest address at Excon 2011, the sixth international construction equipment and construction technology trade fair, being organised by the Confederation of Indian Industry (CII) from 23-27 November in Bangalore, the minister said that India has emerged as the second largest country in the world in attracting private investment in infrastructure development. India would continue to attract foreign participation as the country has an open and transparent bidding process, standards for various documents & agreements, and a well defined dispute resolution mechanism in highways.
The investment made in infrastructure sector in 2011 accounted for 7.9% of the GDP. The figure is likely to increase to 10.7% by 2017.  During the 12th Five Year Plan the infrastructure investment would be in the tune of US$ 1 trillion. The Minister said that to fund the infrastructure projects, India should find alternative sources of finance. The government’s Infrastructure Investment Fund would soon be coming out with a public issue to raise about Rs 10,000 crore.
He said that the ambitious National Highways Building Programme envisages investment of about US Dollars 70 Billion in next 5 years with a major share by way of Public Private Partnership (PPP).
Delivering his Special Address, B Muthuraman, President, CII, said that India should have a solid manufacturing base, and quality infrastructure to achieve double digit growth. And to achieve both, the country needs quality construction equipment. He urged the industry to go for high technology absorption, and enhanced design & engineering capability. The industry should try to market itself in a better way so as to attract the best talent.
He said that it is important to increase the growth of manufacturing sector. Currently the manufacturing sector contributes about 16% to GDP, and 12% to employment. However, it has the potential to increase its contribution to about 25-30% in these two areas.
In his Theme Address, Vipin Sondhi, Chairman, Excon 2011, said that roads are critical to promote inclusive economic growth in India, and for this reason, infrastructure should continue to remain a dominating theme of the country’s growth story.
Quoting the CII Report on The Indian Earthmoving and Construction Equipment Industry Vision 2020: Commanding New Heights, which was released by the Union Minister at the event, Mr. Sondhi said that the Indian construction equipment industry is expected to grow at a compounded annual growth rate of about 21% to reach the size of US$ 23 billion by 2020 from the current level of about US$ 3.3 billion. By 2020, the industry is expected to create at least two million skilled jobs in maintenance and operation alone – that is, excluding the jobs in the manufacturing of equipment.
Talking about Excon, he said that the event has assumed international character, attracting over 200 overseas companies, and eight country pavilions. The gross exhibition area had increased from 1,40,000 sq mtrs in 2009 to 2,20,000 sq mtrs during the current year.
Providing his remarks, Glenville da Silva, Chairman, IECIAL said that the government should articulate its environment policy to unleash the potential of the mining and power sector; come up with a new land acquisition policy that would speed up road infrastructure, and do away with multiple differential taxation systems across State boundaries to support the construction equipment and infrastructure industry.
Mr Silva said that in 2000, when the first edition of Excon was organized, the total number of construction equipment in India was just around 8,000 units. Thanks to the government’s ambitious infrastructure projects, the equipment industry grew by seven times over the last yen years. Currently there are about 60,000 units of construction equipment and India’s CE industry today account for over 6% of the global market. Quoting the CII Report, he said that during the next decade, India’s construction equipment industry is expected to grow six times from the current level, and would have over 3,30,000 units.
In his welcome address, T T Ashok, Chairman, CII, Southern Region, said that the government should focus on addressing the issues of the industry in land acquisition, rehabilitation, tolls, among others. He remarked that in the last ten years the construction industry is driving the economic growth of the country. Government used to be the prime players in the past but today private players drive the growth. The portion of infrastructure investment to GDP has doubled in the last ten years, he said.
Chandrajit Banerjee, Director General, CII, in his concluding remarks, said that the increased size of Excon reflects the upbeat mood in the Indian construction equipment industry which is poised to grow manifold with the entry and expansion of global OEMs.

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