Budget speech 2006-07: Full text

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Road Transport

81. The National Highways Development Programme (NHDP) continues to make impressive progress. The highest ever number and value of contracts were awarded in calendar 2005. I propose to enhance the Budget support for NHDP from Rs.9,320 crore to Rs.9,945 crore in 2006-07.

82. A special accelerated road development programme for the North Eastern region at an estimated cost of Rs.4,618 crore has been approved. For 2006-07, I propose to provide a sum of Rs.550 crore for this programme.

83. Government has also decided to develop 1,000 kms of access-controlled Expressways. These will be on new alignment and built on the Design, Build, Finance and Operate (DBFO) model. The sections that have been identified are Vadodara-Mumbai, Delhi-Chandigarh, Delhi-Jaipur, Delhi-Meerut, Delhi-Agra, Bangalore-Chennai and Kolkata-Dhanbad. The concessionaires will be selected through an international competitive bidding process.

84. National Highway Authority of India (NHAI) will be restructured and made more effective. It will be made into a multi-disciplinary body with the capacity to handle a large number of PPP projects. New skill areas in planning and quality assurance, standardization, arbitration, road-safety and R&D will be created.

Maritime Development

85. Honourable Members are aware that the National Maritime Development Programme (NMDP) has been approved by the Government. The port sector alone will require Rs.55,804 crore. Work is in progress in 101 projects covering, inland waterways, shipping and ports which include deepening of channels in Kandla, JNPT and Paradip. I propose to increase the Plan allocation for the Department of Shipping by 37 per cent to Rs.735 crore.

86. A deep draft port is required in the eastern part of the country. I am happy to announce that it is proposed to carry out a detailed study to identify a suitable location for a new deep draft port in West Bengal. The existing National Institute of Port Management, Chennai, has been renamed as the National Maritime Academy, and it is proposed to upgrade it into a Central University under an Act of Parliament. The University will have regional campuses at Mumbai, Kolkata and Visakhapatnam.

87. The India Infrastructure Finance Company Limited (IIFCL) has been incorporated, and the first proposal for funds has been received. Several proposals have been received for viability gap funding for PPP projects. In-principle approval has been granted to three road projects in Gujarat and a final decision is likely to be taken before March 31, 2007.

X FINANCIAL SECTOR

Banking, Insurance and Pensions

88. As part of the reforms in the banking sector introduced in 1993-94, capital was infused in the banks by issue of special securities. To date, Government has injected Rs.16,809 crore into nationalised banks. Adding the perpetual securities issued earlier, the total net capital support stands at Rs.22,808 crore. Thanks to the capital support, a sound banking sector meeting international norms has emerged. We have reached a stage when we can wind up the special arrangements between Government and the banks. Accordingly, after consulting the RBI, I propose to unwind the special securities through conversion of these non-tradable special securities into tradable, SLR Government of India dated securities. This will facilitate increased access of the banks to additional resources for lending to the productive sectors in the light of the increasing credit needs of the economy.

89. Honourable Members are aware that the K.P. Narasimhan Committee was appointed to recommend a comprehensive law on insurance. The report of the committee has been received, and is being examined by the Insurance Regulatory and Development Authority and the Government. I intend to introduce a comprehensive Bill on insurance in 2006-07.