>INDIA TRANSPORT INFRASTRUCTURE (BNP PARIBAS)

The world's largest PPP playground

■ The Minister for Road Transport and Highways, Mr Kamal Nath, is spearheading the effort to revamp the lacklustre performance of the National Highways Authority of India (NHAI). Although NHAI has a project pipeline of 135 projects valued at approximately INR1t, we believe approximately INR400b- 500b will be bid out during FY10.

■ The ticket size of metro projects (approximately INR3.0b) has been too low to evoke interest among the larger developers. However, the three-fold approach comprising increasing complexity (and subsequent bigger tickets), the PPP route for development and the passing of the Metro Act should provide an impetus to the sector. The projects pipeline, worth INR1,010b for five metropolitan cities, will lead the development in the sector.

■ The game plan, according to the Minister for Shipping, Mr Thiru G K Vasan, involves the award of 22 projects during fiscal year 2010. However, the ministry has missed its first milestone: during the first 100 days of the new government, only three of the six scheduled projects were awarded.

■ We profile IRB Infrastructure Developers Limited, a pure-play highway developer, as an opportunity in the highway sector. Acceleration in highway project awards should also benefit other major infrastructure companies such as L&T, GMR Infra, and Reliance Infra; however, highways would contribute less than 10% of their revenue.

To see full report: INDIA TRANSPORT INFRASTRUCTURE