| BALLIA, India, June 26
BALLIA, India, June 26 In a wheat field near the
mighty Ganges river stands a cracked foundation stone surrounded
by nibbling goats and farmers driving their cattle in the baking
Unveiled more than four years ago, it's all that remains of
an ambition to build India's longest expressway, an eight-lane,
1,050-km (650-mile) road that would have run through Uttar
Pradesh state and connected one of the country's most backward
regions to the doorstep of the nation's capital.
Supporters of the Ganga Expressway project say it would have
helped transform Uttar Pradesh, India's most populous state and
one of its poorest, and the lives of its 200 million people by
slashing travel times and letting industry and townships sprout.
But having been in and out of the headlines for years, the
project has all but crumbled under the weight of political
wrangling, opposition from farmers whose fields would have
suffered, and a court order in 2009 stalling construction on
"It's one of those projects that can change the development
map of a region," said Gopal Sarma of the consulting firm Bain &
"At the same time, there is the whole issue of how do you
deal with people who have held onto pieces of land for literally
hundreds of years, and are not really looking at compensation
but are looking to continue a way of life that they have had?"
The failure of the Ganga Expressway offers a snapshot of
India's chronic infrastructure woes and a reality check on Prime
Minister Manmohan Singh's recent promise to speed up more than
200 key projects.
New Delhi has set an ambitious target to pump $1 trillion
into an overhaul of infrastructure over the next five years,
revamping roads, building airports and tackling endemic power
blackouts. But, as the Ganga Expressway shows, such targets are
all too often held hostage to harsh realities on the ground.
It's also symptomatic of how, for India's leaders, political
expedience often trumps the need to revive investor sentiment
and growth. In recent months, one party in the ruling coalition
blocked a proposal to open the retail sector to foreign
investment and the government has dithered on slashing costly
state subsidies on fuel, fertilisers and food.
"It was a very ambitious project," said a former top state
official who was closely involved in the expressway proposal,
speaking to Reuters on condition of anonymity. "The tragedy of
the whole situation was that the politics came in.
"People don't know what is good for the state, good for the
people, good for the country," the official added.
Driving across Uttar Pradesh's existing highways can be by
turns treacherous or mind-numbingly slow. Cars and trucks jostle
with bicycles, bullock carts, cows and goats along what are
often narrow and potholed roads, gumming up traffic and
prompting drivers to veer dangerously across lanes to overtake.
With a creaking rail network, India relies heavily on such
highways to transport goods. But their often-shoddy condition
saps the competitiveness of companies and creates supply
bottlenecks that have helped keep inflation uncomfortably high.
The average speed of trucks travelling on Indian roads is
just 35 km (22 miles) per hour, less than half the 75 km (47
miles) in the United States, according to a report by global
management consultancy McKinsey and Company.
The Ganga Expressway was supposed to help change all that.
Conceived under Mayawati, a four-time chief minister of Uttar
Pradesh with prime ministerial ambitions, the stone was unveiled
with much fanfare on her 52nd birthday in January 2008.
A contract to build the road was awarded to a unit of
Jaiprakash Associates, a construction and
infrastructure giant that also built India's Formula One track.
Sameer Gaur, a top executive at the group who led the project,
declined to comment for this article.
Under the state government's proposal, the company was to
both fund and build the project. In return, it could charge toll
fares and develop potentially lucrative real estate along the
road - a version of the public-private-partnerships (PPP) that
cash-strapped Indian governments have pushed in the sector.
But as is so often the case in India's troubled
infrastructure story, one person's key development project is
another person's land grab.
Farmers, egged on by what was at that time the state's main
opposition Samajwadi Party (SP), said the project would rob
small landholders of fertile land and their livelihoods.
Grumbling about inflation, power and water shortages, the
farmers have scant faith in politicians and struggle to see how
a massive highway running over their lands would benefit them.
"The government has done nothing for us except raise
prices," said one, Dinesh Rai. "We are fooled by every party
that comes in."
"What are we going to sell if we can't grow anything? What
will we carry along an eight-lane road? Mud?" joked another,
Jitender Kumar Yadav.
The SP, which booted Mayawati out of office in state
elections in March, called the project a conspiracy and staged
Ambika Chaudhary, the revenue minister in the new
government, proudly told Reuters his activists, then in
opposition, caused such a furore that Mayawati scrapped a
planned trip to lay the foundation stone in 2008. Instead, she
unveiled it at the state capital, Lucknow, and later had the
stone transported to its current location.
"She did not dare to come to Ballia," Chaudhary said. "We
protested like anything and the programme was cancelled."
Officially, the Ganga Expressway still exists on paper, but
with SP in power in Uttar Pradesh, it is unlikely to be built,
at least for years.
Across India, poor infrastructure has helped put the brakes
on the once-stellar growth of Asia's third-largest economy,
which has dropped to its slowest pace in nine years, and
businesses are clamouring for more policy action.
Lacking the financial muscle that China has to bring its
infrastructure up to speed, New Delhi has turned to the private
sector to fund half of the $1 trillion target.
But time after time, big investments fall prey to red tape
and battles over land, stalling projects for years. Firms
complain bureaucracy and corruption delay the awarding of
contracts, while debt to fund new ventures is scarce and the
market in which to bid for them too aggressive.
As a result, New Delhi has consistently missed construction
and funding targets for many sectors in recent years. Out of 583
projects worth more than 1.5 billion rupees ($27 million) each,
235 are delayed, according to the government's 2011-12 economic
Roads are the worst hit, although the $8 billion Golden
Quadrilateral project, that links big cities New Delhi, Mumbai,
Kolkata and Chennai with modern highways, has been mostly
Examples abound of projects hit by similar woes to the Ganga
road. The KMP Expressway, aimed at slashing congestion in the
capital, was meant to be completed a year before the 2010
Commonwealth Games in Delhi. Instead, land disputes and delays
in obtaining clearances caused it to miss several deadlines and
it is now scheduled to be finished next May.
Bain's Sarma estimates that India will only achieve about
$650 billion of the $1 trillion target, and that number could
fall further if the government fails to lift corporate sentiment
with some key policy decisions over the next 3-6 months.
"We still are facing huge policy paralysis to get projects
moving forward. Project pipelines are slow," he said.
Facing an avalanche of criticism over his government's
handling of the economy, Singh has raised infrastructure targets
and rolled out a system to track key projects.
A senior government adviser, speaking on condition of
anonymity, said the renewed push would help make individual
ministries more accountable on performance, but added that he
didn't "expect miracles".
For now, infrastructure players will likely wait and see
whether Singh can deliver on his promise of a new impetus.
"(We're) not too optimistic, to be frank with you, because
it is not the first time that such intentions have been made
public," Vinayak Chatterjee, the chairman of Feedback
Infrastructure Services, told Reuters Television.
"But I think there is a sense of fatigue with mere
announcements of targets or mere announcements of new projects."
(Additional reporting by Sharat Pradhan in Lucknow and Ankush
Arora in Gurgaon; Editing by John Chalmers and Raju