EXPERTS in a webinar on Saturday asked the government to address discrepancies in policies that heavily favour foreign companies to win almost all mega infrastructure projects in the country. They noted that Indian contractors are increasing their presence in the country under the Line of Credits and over two dozens of Chinese state-owned firms are working in major engineering projects under government-to-government deals.
Despite having successful experience of building the Teesta Barrage in 1991, local construction houses are kept outside of almost all the mega projects in their own backyard, they said. Planning minister MA Mannan attributed the dependence on foreign funds to the heavy presence of foreign firms in the country’s infrastructure-related projects. Giving assurance of addressing the demands, Mannan stressed the need for quality enhancement of projects implemented by local firms.
While it’s true that some of our local firms don’t have the ability to do good work–it’s also true that many of them can and do outstanding work. So the excuse that we can’t do good projects is not right. What is essential is that if we rely on foreign funds to do any big infrastructure project we should ensure that at least fifty percent of the work goes to local firms.
After all, no fund is simply a grant — many are loans on concessional terms which must eventually be paid with taxpayers’ money. So why can’t we negotiate for a better option for our construction firms? It simply denotes that our negotiators can’t do a better job when getting foreign funds for such mega projects. Also the Chinese firms have a tendency of increasing project costs two to three folds after winning contracts at low prices.
Once the projects are done the firms will simply walk away. If they are made with local firms then we will also retain the capacity to look after them when deterioration will take place. So giving share of such contracts to local firms is essential for capacity building in the long term.
