Consulting Engineers Association of India is a non-profit organisation representing engineering consultancy firms and individual engineering consultants, and advocates global networking and cooperation. A.P. Mull, who had a long stint of over 37 years with Tata Consulting Engineers Ltd and is on the company’s Board of Directors, shares his views on projects in India with B.P. Nansi.
India is at a crossroads and project investment is picking up. What do you see about project scenario in next five years?
We can differentiate projects basically as of public and private sectors. The PPP projects are also taking off but are still to be streamlined. The public sector projects are primarily for nation building, sustainable development and inclusive growth. The return from these is not always in monetary terms. The private sector ones are more for monetary returns. The investment scenario, as is well known, is linked to governmental policies and, of course, the stability of the government. With the populace having decided that they want stability, the dust is settling down. We expect the projects in all sectors to pick up. Half a decade later, I see India buzzing with activity in all sectors.
Tell us about India’s major project work area today and the scenario after five years.
Infrastructure projects for metros and railways, ports and harbours, and water and wastewater are the big ones currently progressing. Highways and roads, airports and power are going slow on account of the various issues associated with them. There is reasonably good movement in the petrochemicals and other chemicals and industrial sectors. Urban development is also sporadic whereas housing and commercial are going through trying times.
In the next five years, we should see growth in the manufacturing sector, which caters to consumer-based products like FMCG or household equipment, construction materials and even automobiles. Another area of growth could come from agriculture. Also, many organisations are investing large funds into R&D in pharmacy and this will lead to increased activity in pharma sector.
What is the scene today in global development in projects? What is India’s role in global work?
The Western and the European economies are down. In the Middle East, Africa, Central Asian and other Asian countries, there are developmental projects. Many of these countries are developmentally in their nascent stage. The capabilities of Indian engineers has been recognised and accepted and they are playing a role in the projects in all these countries. Thus, the work there is enormous and will go on for decades. The Government of India is also providing funds to many countries in Africa, the SAARC region and others for their development.
Added to this is the fact that India is globally seen as a country with sustained growth. This is leading large global players, who do not as yet have a presence, to consider establishing their manufacturing base in India.
What shortcomings does India have, if you think there are any, in project selection, design and implementation?
The need and conceptualisation and the subsequent selection of a project are involved processes. The project budget must be made to take care of the unknowns. The sanctions should not be so sacrosanct that the risks, when they surface, are left to the consultants, vendors and contractors to address. Mostly, it is reported that the project budgets are pruned to fit in the budget. If that is so, where is the question of quality in the project or *application of state-of-the-art technologies?
Let’s take that a project properly scrutinised receives the go-ahead. The next important step is the selection of consultants. That’s where one needs to be cautious and not go by the lowest bid, just as one does not cringe when one has to get operated. The selection of consultants ought to be on quality-cum-cost basis normally. For highly technical projects, it should be quality based only. Thereafter, the vendors and contractors need to be carefully chosen.
Once there is an intention to set up a project, a proper techno-feasibility study puts a correct perspective and covers reasonable time and cost for implementation.
What is your view on awarding project contracts on L1 basis?
The practice of going by L1 needs to be urgently reviewed. Often the L1 price becomes unworkable during the project. As a consequence, disputes arise, projects stall, cost escalates and the development is affected. Techno-economic criteria should become the basis for all selections. Discoms’ ability to buy power coupled with issues of coal availability and land acquisitions have become the biggest bottlenecks. These need to be resolved.
During execution, proper scheduling of practical timelines, regular review of project exigencies and prompt resolution of all matters are the sine qua non for completing projects on time.