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Accounts / Audit

The infrastructure itch

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The New Indian Express 22.09.2009

The infrastructure itch

Urban India today faces serious challenges of growth and its management.

Across geographies, the issues of urbanisation manifest in the form of overcrowding, congestion, insufficient infrastructure and inadequate service provisioning - mainly in terms of drinking water, sanitation, energy, transport and solid waste management. These, along with the poor management of rapid growth, affect the socio-economic development of the country in general and urban India in particular. Chennai is no exception.

Providing sufficient infrastructure is one part. But managing them optimally and efficiently is the more important part. This can be achieved by providing effective governance and efficient service delivery through institutional improvements and capacity building.

But the practice in vogue in India is to ignore the latter and keep on augmenting infrastructure by going in for mega and big-ticket projects.

Urban infrastructure could be defined as the basic physical systems of a community’s population, including roads, utilities, water, sewage, etc. These systems are considered essential for enabling productivity in the economy. Developing infrastructure often requires large initial investment, but the economies of scale tend to be significant only if these are utilised efficiently and optimally.

Delhi is the typical case of sub-optimal and inefficient management of infrastructure.

Since the late seventies, preparatory to the 1982 Asian Games, Delhi has been investing heavily on infrastructure, particularly transportation. This has been continuously ongoing with the state-of-the-art multi-billion dollar Metro Rail and the current Rs 12,000 crore Commonwealth Games constructionspree going on at break-neck speed.

Yet, just one bout of non-seasonal rain leads to waterlogged roads, uprooted trees, non-functional traffic signals, vehicle breakdowns, serpentine queues of vehicles and even a roofless airport! These happen with unfailing regularity whenever a heavy downpour or thunderstorm hits India’s capital, as it has thrice in August this year alone.

Similar is the case with Chennai when ‘rain gods’ descend on us with some intensity. Chennaiites, particularly those living on riverbanks and low-lying areas, are keeping their fingers crossed awaiting the monsoon, which will not be long in coming.

In the meantime in line with the ‘development mantra’ these days, all attention is on infrastructure and more infrastructure.

Chennai is in hot pursuit of the Delhi path! We have the 45 km Metro Rail project that would cost upwards of Rs 16,000 crore, the socioeconomic benefits of which are not yet known except the vague promise that it would persuade car owners to shift to this ‘public transport’ mode. There is a 108 km High Speed Circular Transport Corridor with the current estimate of Rs 5,400 crore. An ‘elevated’ coastal highway to draw the cars to the Marina and give them a ride over our beaches at a cost of Rs 1,000 crore is on the anvil.

Internal roads, grade separators, flyovers, overbridges, underbridges, road improvements, relaying and medians have cost Rs 550 crore. Added to this is the Outer Ring Road and other roads and bridges. And the MRTS is to extend from Velachery to St. Thomas Mount.

Storm-water drains to combat floods are the latest favourite. A sum of Rs 105 crore has been recently spent and a huge Rs 1,400 crore JNNURM funding is in the pipeline and tenders are being floated. Water and sewerage schemes worth Rs 8,620 crore have been drawn up for JNNURM financing with many works in progress. Solid Waste Management has an estimation of Rs 850 crore and basic services have a budget of Rs 3,900 crore. All these are for a five year period from 2007 to 2012.

In a resource-deficit country that depends on foreign investments, the first task of the government is to make existing infrastructure work at optimal levels through efficient management and service delivery before going in for capital-intensive augmentation projects. But the reverse is happening.

The government is busy with the Financial city and probably an Information and Media city.

Dovetailed with TIDCO’s ‘IT industry Economic Zone’, these are real-estate cum ‘infrastructure’ mega projects drawing on CII’s ‘land bank’ idea, and in line with their forecast that infrastructure would spearhead Chennai’s economic growth.

This ‘infrastructure fix’ is becoming more like an itch. In the fifties there was a movie called ‘The Seven Year Itch’, starring Marilyn Monroe. The theme was ‘relationship term’ (particularly marriage) - usually after seven years people tend to re-evaluate their relationship.

The number seven came from that time period where the average marriage lasted seven years. Now it is much shorter - six months to four years. Exceptions are where a ‘relationship’ is maintained through continued nurturing and upkeep.

One only hopes that due to lack of upkeep, these massive ‘infrastructure investments’ do not turn out to be just ‘six months to four years’ itches!


CAG report slams TN government departments

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The New Indian Express 24.07.2009

CAG report slams TN government departments

CHENNAI: The Comptroller and Auditor General of India report slammed various departments in Tamil Nadu government for non-performance and highlighted irregularities in their functioning.

Releasing the report, the principal accountant general Shankar Narayan pointed out several anomalies in various departments and also in sales tax levies, taxes on vehicles, stamp duty and registration fee and other tax and non-tax receipts.

“Test checks of the records relating to sales tax, state excise, land revenue, urban land tax, taxes on vehicles and departmental offices conducted during 2007-08 revealed under-assessments, short levy, loss of revenue and other observations amounting to Rs 760.93 crore in 2,167 cases,” he said.

In three assessment circles, incorrect exemption of local and inter-state sales of matches worth Rs 117.50 crore resulted in non-levy of tax of Rs 12.69 crore, the CAG report said.

It also hit out at the stamp duty and registeration fees department. Computerisation of the Registeration department has not been fully completed though started in 2001. “Lack of interconnectivity of the sub-registrar offices with the concerned taluk offices resulted in continued registration of the government lands in the name of private individuals,” the report said.

“Incorrect grant of exemption on sale of land by 100 members to four housing societies resulted in non-realisation of stamp duty worth Rs 3.13 crore,” it said.

“In 12 registeration offices, in 23 sale deeds and four lease deeds, due to omission to include the value of the windmills in the instruments, there was undervaluation of properties resulting in short levy of stamp duty and registeration fees of Rs 12.96 crore,” the report added.

The report also slammed Tamil Nadu Minerals Limited for failing to submit mining plans for approval of director, geology and mining within the timeframe leading to rejection and consequent non-removal of the produced granite blocks.

“The company sold granite blocks below cost of production and suffered a loss of Rs 10.69 crore both in departmentally operated quarries and quarries operated through Raising and Raising-cum-Sales Agents.

It said Tamil Nadu Cements Corporation accumulated loss of Rs 45.86 crore as on March 2008, which had eroded its paid up capital of Rs 37.42 crore.


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