Construction sector takes a beating

Though funds are not a major problem, factors like land acquisition, forest clearances and permissions are hindering the sector’s growth.

“Construction sector is taking a beating due to inconsistency of policies. Funds are never a major problem for the growth of this sector because of the public-private sector partnership. However, there are many impediments in the sector’s growth. Environmental, land acquisition, forest clearances and permissions are causing delays in projects and hindering the industry’s growth. For instance, recent court orders on sand mining increased the price of natural sand by five times overnight,” said B Seenaiah, president, Builders’ Association of India.

Stressing about the immediate changes in policies and their repercussions on the sector, he said, “The government should pre-plan. It should conduct a public debate between experts from the private and public sectors to bring in new policies or change existing ones. They should let the industry prepare for the new policy environment before the policy comes in place. However, a quick decision by the government or by the court will put the growth of the whole sector in a mess.”

Talking about land acquisition issues, Seenaiah revealed, “It is a major concern for the growth of the sector. Many power projects or other construction works are in limbo after huge investments with local people agitating against them. Even, Opposition political parties are taking the agitators side by instigating them and making issues more complex. Nobody is thinking about the power crisis or the country’s growth. On the flip side, the locals also should not suffer for the benefit of the nation. They should get around three times the market price and other employment benefits.

“However, if the private sector is planning to acquire land, the locals are demanding a huge price for it, which is almost equal to the value of the land in that area after completion of the project. A private player cannot buy a land worth `2 lakh for `20 lakh. It will put the feasibility of the project at stake,” said Seenaiah.

“The government should acquire the required land at a reasonable price and allot that to the private sector for power projects. All the political parties should come together and support the public in giving land to build the nation. If everybody only considers his/her benefits, the country will continue to be in darkness,” he emphasised.

“The government should also have a vision for the State. If there is a need for an extra 1,000 MW for the State, the government should aim to build the projects that can supply 1,500 MW. Even, if 70 per cent of it turns in to reality, the State will not face a power crisis. For instance, Gujarat is producing surplus power and selling it at a higher price. These profits are used to supply power at affordable prices,” he added.

Tags: Construction sector, featured, forest clearances, full-image, land acquisition, permissions

Category: Business, Business News