Various Issues Around BMIC Project
The report of the House Committee under the chairmanship of Karnataka’s Law Minister TB Jayachandra to probe allegations of irregularities in the Bangalore-Mysore Infrastructure Corridor (BMIC) project has submitted its report in December 2016. This project has been in controversies over land acquisition.
About BMIC project
BMIC is a proposed 4-6 lane expressway project undertaken by the Nandi Infrastructure Corridor Enterprises (NICE) connecting Bengaluru and Mysuru in Karnataka. The project is being constructed on a Build-Own-Operate-Transfer (BOOT) basis. It is proposed to pass through Mysuru, Srirangapattana, Pandavapura, Mandya, Maddur, Channapattana, Ramanagara, Kengeri and Bengaluru.
The BMIC Project was conceived in 1990s to create world class infra to promote Industrial growth and improve economic infrastructure. It was thought that the major economic centres like Bengaluru and Mysuru needed an expressway to ease traffic and promote economic growth.
The agreement for the construction of the project was signed between the state government and a consortium of Kalyani Group India, SAB and VHB of USA in 1995. The construction of the road began in 2004. However, as of now only 41 km of peripheral, 8.5 km of link road and 4km of expressway has been constructed. In the completed segments, toll is being collected from the road users. The rest of the construction activity is held up due to controversies and litigations for several years as of now. In October 2012, the Lokayukta of Karnataka had also ordered a probe into the irregularities committed in land acquisition for the project.
Major findings of the TB Jayachandra committee
The committee has observed that the problem with the project lies in leveraging of excess land and unscrupulous profiting against economic principles embedded in the framework agreement. The committee has found out that 25% of land under the possession of Karnataka Industrial Area Development Board (KIADB) has been transferred through sale transaction to real estate companies. KIADB acquires lands for various State and Central Government organizations. In addition, the report has found out that the compensation paid to the farmers were unfair and the project-affected people were subjected to critical conditions due to non-implementation of rehabilitation in 55 project-affected villages. It has also found that excess toll collection was done on bituminous road against concrete road.
Current Status
The state government may undertake the project with its own budgetary allocations or may seek the central government’s assistance. It may also invite a fresh tender in PPP mode for constructing the expressway.
Question for Examination
For your examination, the broader question is – What are the major reasons for stalled road projects in India? According to the written reply given by Minister of State for Road Transport and Highways to the Rajya Sabha, 112 projects of National Highways Authority of India (NHAI) are running beyond the scheduled date of completion. The reasons for the delay are manifold including- Delay in land acquisition, utility shifting, non-availability of soil/aggregates, poor performance of contractors, delay in statutory clearances, public agitations and disputes. Once projects get delayed, they tend to be downgraded by rating agencies which will increase the repayment and refinance risks for the projects.
