Monday, June 21, 2021

Table of Contents for Ticker Tape


Indospace forms JV with RIL arm to develop 55-acre logistic park in Haryana

Everstone-backed IndoSpace has formed a partnership with Reliance Industries arm METL to develop a 55-acre logistic park at Farukhnagar in Haryana. Model Economic Township Ltd (METL) is a 100 per cent subsidiary of Reliance Industries. The land parcel has a development potential of 1.28 million square feet. IndoSpace has acquired 55 acres at Farukhnagar in Haryana and this acquisition is a joint venture with the METL. METL will have a minority stake in the JV. With this, IndoSpace has expanded its footprint in Delhi-NCR to over 480 acres across eight parks. IndoSpace has a portfolio of over 41 million square feet across 39 industrial and logistics parks under various stages of development in nine major consumption hubs in India.



India likely to develop dedicated midnight freight corridors

India is likely to develop dedicated midnight freight corridors for better management of freight into ports and airports, as part of the National Trade Facilitation Action Plan that outlines steps to improve India’s ease of doing business ranking among global peers.

The ministry of road transport and highways and the National Highway Authority of India will work on the project along with state governments as it would require land use approvals, as per the action plan. The NTFAP has kept the timeline for execution at three years, which includes expediting construction of the Maduravoyal Elevated Corridor in Chennai that has been stalled for many years.

The action plan, which will span over three years till 2023 and will be executed by the Central Board of Indirect Taxes and Customs, also calls for setting up a National Air Cargo Community System that will enable advance slot booking and hence improve efficiency of processing airfreight shipments.

To be implemented over a period of six to 18 months, the system will include radio frequency identification (RFID) tagging of trucks and unit load device or freight loading machines used at airports. Electronic checking of tags will optimise gate operations and reduce turnaround time of vehicles.

An enhanced ‘single window’ interface for all government approvals and clearances has also been proposed. This will include digital preference certificate of origin for export to countries with which India has trade agreements, digital sharing of shipping bill automatically for export shipments and integration with Directorate General of Foreign Trade’s system.

The action plan also aims to amend Advance Ruling Rules to operationalise the decentralized architecture of Authority for Advance Rulings. The CBIC will have to issue a notification to include tariff rate quotas, valuation and exemption and any other area as a subject for advance rulings, it specified. Change the customs brokers licensing regulations to enable appeal and review, also by February 2022, has been planned.



Indian government plans road construction to link Jewar airport with Delhi-Mumbai Expressway

The Government of India has announced plans to construct a 31km long road to connect the upcoming Jewar International Airport in Noida with Delhi–Mumbai Expressway.  The Uttar Pradesh and Haryana governments have reportedly agreed to construct a road to link the two areas. The new expressway passing through Ballabhgarh in Haryana is 31km away from the upcoming international airport at Jewar in the state of Uttar Pradesh. About 7km-stretch of the 31km link road will be required in Uttar Pradesh and the remaining 24km in Harayana. The construction of the new link road will cut down the travel time from Jewar Airport to Indira Gandhi International Airport.  The 1,250km-long Delhi-Mumbai Expressway is proposed to pass through Haryana, Rajasthan and Madhya Pradesh.  Being constructed by the NHAI, the new expressway is expected to be completed in the next two to three years.  Additionally, the NHAI is already constructing a 92km-long road to connect the Expressway with Indira Gandhi International Airport. Recently, the Indian government approved the construction of the second phase of the 334km-long Regional Ring Road (RRR) in the state of Telangana.  The new road project, which is planned beyond the Outer Ring Road (ORR), will connect all the districts of the state with Hyderabad.



Warehousing demand likely to grow 160%to reach 35 mn sq ft in 2021

Warehousing demand is expected to grow around 160 per cent to reach 35 million square feet in 2021, if no further lockdowns occur, according to a JLL report

Warehousing demand is expected to grow around 160 per cent to reach 35 million square feet in 2021, if no further lockdowns occur, said a JLL report.

Despite unfavourable socio-economic environment, warehousing stock in top eight cities, including NCR-Delhi, Mumbai, Bangalore, Chennai, Pune, Kolkata, Hyderabad and Ahmedabad has added 27 million square feet to reach a total of 238 million square feet in 2020 as per the ‘India Real Estate Outlook - A new growth cycle’ by JLL.

In Q4, the market started gaining momentum with highest supply and absorption in 2020 post the lockdown. Industrial spaces witnessed a 13 per cent Y-o-Y growth in total stock in Grade A & B warehousing space in top 8 cities. The overall warehousing space stands at 238 million square feet at the end of 2020 compared to 211 million square feet in the previous year thereby resulting in a net supply of 27 million square feet. In 2020 the end -users or tenants have looked for new and innovative ways to take up spaces on short term or temporary leases of tenure 9-12 months for leasing of ‘white spaces or unused spaces’ in existing leased warehouses on sub-lease. Unfortunately, these do not get captured in net absorptions (considering these are already leased).

The warehousing and logistics market in India started gaining impetus with highest supply and absorption in the Q4 of 2020. The demand is expected to increase in 2021 and reach close to 35 million square feet of absorption, almost similar in line with 2019 levels, supported by growing demand in sectors such as 3PL (third party logistics) and e-commerce.

3PL has become one of the fastest growing segments in the warehousing space, contributing nearly 35 per cent of total net absorption in 2020, highest among all the other sectors. Likewise, many e-commerce categories are expected to do very well, as consumers are making a behavioural shift from buying offline to online. Further, the report noted that Covid-19 has accelerated e-commerce adoption rates with an increase in UPI transactions by 42 per cent during the lockdown period, leading to an upsurge in the demand for online delivery of essential and non-essential items.



Dilip Buildcon Ltd’s subsidiary receives appointed date from NHAI

Dodaballapur Hoskote Highways Private Limited, Wholly owned subsidiary of Dilip Buildcon Ltd has received the appointed date letter from the National Highways Authority of India and had declared the appointed w.e.f. February 22, 2021. The Appointed Date has been given by The National Highways Authority Of India for HAM Project Viz. ‘4 Laning From Km. 42.000 To Km. 80.00 Of Dodaballapur Bypass To Hoskote Section Of NH-648 (Old NH-207) On Hybrid Annuity Mode Under Bharatmala Pariyojna In The State Of Karnataka (Package-II).



48 infra projects show cost overruns worth Rs.4.02 lakh crore

As many as 448 infrastructure projects, each worth Rs.150 crore or more, have been hit by cost overruns totalling more than Rs.4.02 lakh crore, according to a report. The Ministry of Statistics and Programme Implementation monitors infrastructure projects worth Rs 150 crore and above. Of the 1,739 such projects, 448 reported cost overruns and 539 were delayed. “Total original cost of implementation of the 1,739 projects was Rs.22,18,210.29 crore and their anticipated completion cost is likely to be Rs.26,20,618.44 crore, which reflects overall cost overruns of Rs.4,02,408.15 crore (18.14 per cent of original cost),” the ministry’s latest report for January 2021 said.

The expenditure incurred on these projects till January 2021 is Rs.12,29,517.04 crore, which is 46.92 per cent of the anticipated cost of the projects. However, the report said the number of delayed projects decreased to 401 if delay is calculated on the basis of latest schedule of completion. Further, for 941 projects neither the year of commissioning nor the tentative gestation period has been reported.

Out of 539 delayed projects, 106 projects have overall delays in the range of 1-12 months, 131 projects have delays of 13-24 months, 187 projects reflect delays in the range of 25-60 months and 115 projects show delays of 61 months and above. The average time overrun in these 539 delayed projects is 44.65 months.

Reasons for time overruns as reported by various project implementing agencies include delay in land acquisition, delay in obtaining forest and environment clearances, and lack of infrastructure support and linkages. Delay in tie-up for project financing, delay in finalisation of detailed engineering, change in scope, delay in tendering, ordering and equipment supply, and law and order problems, among others, are the other reasons, the report said.

The report also cited ‘state-wise lockdown due to COVID-19’ as a reason for delay in implementation of these projects. It has also been observed that project agencies are not reporting revised cost estimates and commissioning schedules for many projects, which suggests that time/cost overrun figures are underreported, it added.



L&T Construction bags contract to build two units of Kudankulam Nuclear Power Project

The construction arm of L&T has secured a significant order in the Nuclear sector from Nuclear Power Corporation of India Limited (NPCIL) for its Heavy Civil Infrastructure business in India to construct the Main Plant Civil Works of the Kudankulam 5&6 units (KKNPP 5&6 - 2X1000 MWe)

The Kudankulam Nuclear Power Plant is India’s first Light Water Reactor (LWR) of 6 units with a generation capacity of 1000 MWe each. The scope of work includes construction of the Reactor Building, Reactor Auxiliary Building, Turbine Building, Diesel Generator Building and other Safety Related Structures in a duration of 64 Months.

L&T is currently executing similar works of Kudankulam 3&4 units (KKNPP 3&4) in the same premises.



NTPC commissions Unit 2 of 800MW capacity of Gadarwara project

Based on achievement of approved norms, Unit-2 of 800 MW capacity of Gadarwara Super Thermal Power Project has successfully completed trial operation and consequently included in the installed capacity of NTPC. With this, the total installed capacity of NTPC and NTPC group has become 52110 MW and 64875 MW respectively.



National highways construction pace touches record 34 km/day

The pace of construction of national highways has touched a record 34 km a day. This is almost three times the rate of highways construction at about 12 km per day in 2014-15.

The Ministry of Road Transport & Highways (MoRTH) has achieved another milestone by constructing 12,205.25 km of National Highways in the current financial year 2020-21 (till 22nd March, 2021), i.e., with construction of 34 kilometres per day.This is also 1,205 kms more than the target of 11,000 kms fixed for the current fiscal. This achievement is significant as the first few months of the current financial year were lost due to nation-wide lockdown in the wake of COVID-19 pandemic. Construction activities were badly affected during the period.

On March 1, Road Transport and Highways Minister Nitin Gadkari had announced achieving the target of constructing 11,000 kms of national highways one month ahead of schedule.

The ministry, in the last few years, has taken several initiatives to increase the pace of highway construction in the country.

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