RNI no.: maheng/2014/55864 vol. 3 issue: 8 mumbai december 2016 price: x100 Pages:96
Special Issue
Shifting
Gears
Roads construction is gaining pace. The new hybrid annuity model can drive private participation.
Focus Mumbai Metro Mumbai’s upcoming metro line III has imbibed the lessons of the past. //P52
Real Estate How Attractive is Housing as an Investment? //P54
content india talk 8 News on Indian Project
BAUMA Conexpo India 2016 30 Event Profile
cover story 18 Shifting Gears
Focus
Interviews - BAUMA Conexpo India 2016 34
52 Mumbai Metro
38
Real Estate 54 Housing investment
VOX Pops 60 Views on Demonetisation of real estate experts
Devendra Kumar Vyas, CEO, Financial Services, SREI
36
Rajendra Raina, General Manager, Marketing, Escorts Construction Equipment
Pankaj Kumar, VP, DOZCO India
40
PV Ramdev, MD Everest Engineering Equipment
Feature
66 Ports and Shipping
INTERNATIONAL TALK 84 News on International Project
EVENTS CALENDAR 92 National
Quote of the Month Connectivity is the backbone of regional and local development. Main transit system such as the railway, metro rail, BRTS etc help the local people and economy huge. Construction activities in these sectors need attention and support on high priority basis from government as well e the private sector. Academia to would have a lot to contribute Dr. Sudhir Krishna, Former Secretary, Ministry of Urban Development, Government of India
4 | CONSTRUCTION TIMES | December 2016
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Editor In Cheif Ramamurthy Mayavan Director Communication Kranti Shanbhag
Dear Readers, India continues to be one of the fastest growing economies with its GDP accelerating to 7.3% in the September quarter. This growth may taper a bit owing to the impact of demonetisation but it nevertheless remains among the fastest growing economies of the world. One of the biggest focus points of PM Narendra Modi’s government has been on infrastructure development. And rightly so. There is a direct correlation between infrastructure development and economic growth. The government has proposed to increase its infrastructure spend by 22 per cent over the next two years. In the midst of this, the fourth BAUMA Conexpo India 2016, to be held from December 12-15 at New Delhi has its own significance. With over 750 exhibitors and 30,000 plus business visitors, this is undoubtedly one of the largest international trade conferences for the construction machinery, building material machines, mining machines and construction vehicle industries. This issue, other than giving you a peak into what Buama has to offer, in the cover story - also covers the development of roads and highways - a sector that continues to hog the limelight. The infrastructure and allied industries look set for improved times in the years ahead and we’ll bring you all the developments and insights as this fascinating story unfolds. Starting from all the action expected at Bauma 2016. Be sure to meet us there at our very own stall. Wish you all a great exhibition and conference.
Ramamurthy Mayavan
6 | CONSTRUCTION TIMES | December 2016
Asst. Editor Kartiki Lawate Sr. Manager Sales & Marketing Sampat Dam Creative Head Sachin Dalvi For Subcription constructiontimes02@gmail.com Registered Office ARK Events & Media Pvt. Ltd. S-02, Haware Fantasia Business Park, Second Floor, Near Inorbit Mall, Sector 30-A, Vashi, Navi Mumbai - 400 703 Tel.: 022 650 67220/22/23/24 www.constructiontimes.co.in *Responsible for selection of news under the PRB Act, 1867. All rights reserved. While all efforts are made to ensure that the information published in correct, Construction Times holds no responsibility for any unlikely errors that might have occurred with regards with content and photographs. Plagiarism in any form is prohibited.
Printed & Publisher by Mr. Ramamurthy T. Mayavan on behalf of M/s. ARK EVENTS & MEDIA PRIVATE LIMITED at: S-02, Haware Fantasia Business Park, Second Floor, Near Inorbit Mall, Sector 30-A, Vashi, Navi Mumbai-400 703 Printed at NAS PRINTING PRESS & PACKAGING at.: 316, Floor - 3, Todi Industrial Estate. N. M. Joshi Marg, Lower Parel, Jacob Circle, Mumbai - 400011. Editor:- Ramamurthy T. Mayavan
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India
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273 infra projects cause cost overrun of Rs 1.77 lakh crore As many as 273 infrastructure projects, including those delayed due to land acquisition, forest clearances and other reasons, have led to a cost overrun of Rs 1.77 lakh crore, as per official data. In August 2016, the Ministry of Statistics and Programme Implementation monitored 1,167 infrastructure projects, each worth Rs 150 crore or more across sectors such as power, railways and roads. The ministry said in its flash report that out of the 1,167 projects, 282 are on schedule, 337 are delayed, 273 projects reported cost overrun and 85 projects reported both time and cost overrun with respect to their original project implementation schedules. “Total original cost of implementation of the 1,167 projects was Rs 14,33,476.53 crore and their anticipated completion cost is likely to be Rs 16,10,504.54 crore, which reflects overall cost overrun of Rs 1,77,028.01 crore (12.35% of the original cost),” it said.
Smart cities to increase by 27 Twenty seven more cities from 12 states have joined the list of smart cities in the third round. These cities will need an investment of close to Rs 67,000 crore. With this 60 cities have been selected by the urban development ministry. Only nine more states and UTs are still to get on board, including Uttarakhand and Jammu & Kashmir.
As per the report, the expenditure incurred on these projects till August 2016 is Rs 6,30,581.41 crore, which is 39.15% of the anticipated cost of the projects. However, the report stated that the number of delayed projects decreases to 283 if the delay is calculated on the basis of the latest schedule of completion. Further, 81 projects have been sanctioned without original commissioning date and for 460 projects neither the year of commissioning nor the tentative gestation period has been reported, it added.
Maharashtra has bagged five cities - the maximum number in this round . Pollbound Uttar Pradesh has three cities on the list including Prime Minister Narendra Modi’s constituency of Varanasi. Four cities each from Tamil Nadu and Karnataka have also made it to this third list, followed by three from UP and two each from Punjab and Rajasthan. One city each from Madhya Pradesh, Andhra Pradesh, Odisha, Gujarat, Sikkim and Nagaland were also selected in this round Sikkim and Nagaland are the latest entrants from north-east India. As per the ministry, an investment of Rs 1.44 lakh crore has been proposed .
Arun Jaitley urges more private investment in infrastructure Union Finance Minister Arun Jaitley has asked representatives of industries and trade to increase private investments, especially in the infrastructure sector. Holding his fourth pre-budget consultative meeting for the union budget 2017-18 with industries and trade representatives in late November, Jaitley said that in the first half of the current financial year 2016-17, the Indian economy achieved a robust growth rate despite volatility and uncertainty in the global economy. “This was made possible by a slew of policy measures undertaken by the present government including enhanced
public investment, kick-starting stalled projects, improving the status of financial inclusion significantly among others,” an official statement quoted him as saying. He also said that the government took many steps to improve governance by bringing in transparency and efficiency through systematic changes.
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According to the minister, the government gave greater thrust on fiscal federalism and improving business environment through reforms in policies and regulation among others. Industry associations and groups recommended the reduction in corporate tax and withdrawal of tax incentives which will result in higher collections due to better compliance and will make India an attractive investment destination. Other suggestions include complete elimination or a major reduction in minimum alternate tax (MAT) and higher public investment in infrastructure and social sector.
India
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Govt. imposes safeguard duties on some steel imports Government has imposed antidumping duties on hot rolled flat sheets and plates of alloy or nonalloy steel to curb cheaper imports into the country, a government notification informed. The government will gradually lower the duty from 10 per cent this year to 6 percent by 2019. The effective duty rate would be arrived at after deducting the value of the goods and the anti-dumping duty payable when the import price is below $504 per tonne, it said. Indian steelmakers JSW Steel, Essar Steel ESRG.UL and Steel Authority of India had approached the Directorate General of AntiDumping and Allied Duties seeking safeguard measures against cheap imports flooding local markets and pressuring margins.
Supreme Court refuses to stay Allahabad HC order of making DND fly way toll free The Supreme Court, earlier last month, refused to stay the Allahabad High Court order which made DND (DelhiNoida-Direct) toll free. The apex court said no toll should be collected until further orders. Following a public litigation interest (PIL) filed by Federation of Noida Residents’ Welfare Association in 2012, the Allahabad High Court had ruled that no user fee can be collected by the private concessionaire from the commuters of the 9.2 km long, eight-way flyover that connects the capital city of India and Noida and its neighbourhood. The PIL had challenged the levy and collection of toll by Noida Toll Bridge Company Ltd any further as it argued the company has made sufficient profit. The Noida Toll Bridge Company Ltd – which operates the toll way - filed a plea in the Supreme Court against the Allahabad High Courts’ order. Noida Toll Bridge Company had asked the apex court to get its accounts audited by the Comptroller and Auditor General (CAG). The court
said the accounts of DND toll company will be audited either by CAG or by an independent auditor to find whether the profit recovered was adequate. The Supreme Court will pass an order about auditing the account and till the audit report is submitted, there will be no toll on the expressway, an SC bench comprising justices AR Dave, RK Agrawal and AM Khanwilkar said. The toll for the fly way, which opened on February 2001, was Rs 8 initially, but it was gradually hiked to Rs 28 per trip. About 1.5 lakh vehicles use the DND flyway on a weekday.
Cabinet approves 1120 km of NH in 5 states at Rs 6461 crore to be completed by July, 2019 and maintenance works are expected to be completed by July, 2024.
The Cabinet Committee on Economic Affairs (CCEA), which is chaired by the Prime Minister Narendra Modi, has approved development of 1120 kms of national highways in the five states of Karnataka, Odisha, Bihar, Rajasthan and West Bengal. The revised cost is estimated at Rs 6,461 crore including cost of land acquisition, resettlement and rehabilitation and other preconstruction activities, according to an official statement. CCEA said while the proposal was initially approved for Rs.5,193 crore but the cost has increased due to higher bid prices, and increase in
cost of land acquisition, resettlement and rehabilitation and other preconstruction activities. The projects are already taken up for implementation and 429 kms has been completed. The civil works are expected
10 | CONSTRUCTION TIMES | December 2016
The work for development to two lane standards are under Phase-I of the National Highways Interconnectivity Improvement Project (NHIIP) with World Bank assistance. “The project will ensure safe, fast and all weather movement of traffic on the proposed National Highways mostly located in backward regions thereby improving socio economic development,” the statement said.
India
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L&T to convert Nagpur into country’s first large-scale integrated Smart City are delighted to be participating in transforming Nagpur into one,” said Mr. S N Subrahmanyan, Deputy Managing Director and President, Larsen & Toubro.
Heavy engineering and construction major Larsen & Toubro has been chosen by the Maharashtra government to convert Nagpur into the country’s first large-scale integrated Smart City. In the phase-I, L&T’s Smart World Communications business vertical, which is a part of L&T Construction, will cover laying of 1200 km of optical fiber network backbone in the Orange city, creating 136 City wifi hotspots at key locations, establishing 100 digital interactive kiosks and developing city surveillance systems with 3800 IP based cameras. Further, as an avant-garde endeavor, the city has identified a strip of approximately
6 km (from Japanese Garden Square to Orange City Hospital Square) to be developed as a ‘Smart Strip’ with stateof-the-art systems powered by smart ICT interventions like smart transport, solid waste management, smart lighting, etc. which can be leveraged in a phased manner to ultimately cover the entire city. “After Jaipur, this is the most significant step in the country’s journey towards establishing smart cities and we
IIT-Kharagpur roped in to suggest technology for maintenance free highways Maintenance of country’s national highways for a longer period could get a new lease of life with the prestigious Indian Institute of Technology-Kharagpur is set to embark on an ambitious project which will suggest technologies for maintenance free highways. At present, the construction of these highways requires a monolithic (in-situ) layer of cement concrete normally 300 mm thick laid continuously over the prepared surface. The idea is to innovation of a technology to optimize the design of concrete pavement in its traditional form which can facilitate faster construction at much cheaper cost. The National Highways Authorities of India (NHAI) and IIT-Kharagpur has signed a pact recently for research project to develop technology to construct long lasting maintenance free highways in the country.
The duration of the research project is 3 years and NHAI have paid Rs. 1.25 crore for the project, excluding cost of construction of trial pavement section on national. NHAI and IIT Kharagpur will develop a technology to construct Panelled Cement Concrete which can replace the design of construction of existing cement concrete road. To overcome this problem, the government has recently announced a policy for the construction of concrete pavements for all major highways due to their longevity and maintenance free life. The Paneled concrete pavement laid on a lean concrete base can fulfil the Government of India’s dream of providing long lasting maintenance free pavement at a cost on par with those of asphalt pavements.
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“As a Master Systems Integrator, we will provide leading edge technology solutions including high end analytics, mobile surveillance and high-tech tools like drones,” he added. L&T’s Smart World business has executed the smart city project in Jaipur and is executing India’s largest city surveillance project comprising 6000 cameras across 1500+ locations in Mumbai. Projects are also underway in Delhi, Lucknow and Hyderabad, the company said.
197 road projects being developed in NE at Rs 37,691 crore: Govt The government has informed the law makers that there are 197 road projects are being developed in the North Eastern region of the country under the watch of Ministry of Road Transport and Highways (MoR&TH) in the North Eastern States. The total length and the total sanctioned cost of these projects are 4320.95 kms and Rs.37691.05 crore respectively. Apart from road projects, 20 major railway projects consisting of 13 new lines with a length of 2624 km at a cost of Rs 52,030 crore have also been taken up in the North Eastern Region. An expenditure of Rs.21336 crore has been incurred on these projects upto March, 2016. An outlay of Rs.5040 crore has been provided for 2016-17 for these projects and for the residual liabilities of some completed projects, as per reports.
India
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Indian Railways’ station development programme kicks off landmark of Gandhinagar.”
Kicking off the government’s railway station redevelopment programme, the company that has been formed especially for the purpose – the Indian Railway Station Development Corporation (IRSDC) – is now inviting bids for redeveloping the Gandhinagar and Surat railway stations in Gujarat. Sanjeev Kumar Lohia, CEO, IRSDC, told CT two special purpose vehicles (SPV) would be formed jointly with the Gujarat state government entities within the next 15 days, one each for Surat and Gandhinagar. IRSDC will float the tender for Gandhinagar on December 2, inviting bids from engineering, procurement and construction (EPC) companies to develop the station as well as a star-category hotel on top of the station. The construction work is expected to be awarded in January 2017 and the cost of development is estimated
Lohia added that the SPV overseeing the Gandhinagar project will invite bids from all the top hospitality brands in the country to operate the hotel under a management contract. “Leading hoteliers in India have expressed interest and we will be meeting with them shortly to discuss the way forward,” Lohia said. at Rs 130 crore.
For Surat, IRSDC has already invited request for qualifications.
Lohia told CT, “The hotel will be constructed as three separate towers. The first one will have 30 rooms of five-star category. The second one will be threestar with 120 rooms while the third tower will be a budget establishment with 150 rooms. When completed, the entire station and hotel will be the tallest building and the most prominent
IRSDC has been entrusted with developing 12 stations out of the 400 stations that the Railways Ministry has earmarked for redevelopment. Out of this, it recently awarded the work for Habibganj station in Madhya Pradesh to Bansal Pathways Habibganj Private Limited along with stations in other states.
Hiranandani back in the fray for Navi Mumbai International Airport project Hiranandani Group is back in the fray for the Navi Mumbai international airport (NMIA) project along with its consortium partner, Zurich Airport. Hiranandani had earlier been disqualified from bidding for the project due to concerns over the company’s security clearances but Hiranandani subsequently submitted a bid for building the Goa airport two months ago. After their bid was accepted at Goa, Hiranandani moved the courts, saying it should be allowed to bid for other airports as well. The matter was then referred to the International Civil Aviation Organisation (ICAO) who allowed Hiranandani to bid for the Navi Mumbai project. The last date for submission of bids is November 7. The three other companies in the fray so far are GVK, GMR Group and Tata Realty along with Vinci Concessions. The bids will be submitted to City Industrial and Development Corporation (CIDCO) who will sift through them and pass on its recommendations to the project monitoring and implementation committee (PMIC). The PMIC is headed by the state chief secretary and comprises of representatives from the union civil aviation ministry. The 14 | CONSTRUCTION TIMES | December 2016
bids will then be passed on to ICAO after which the winning bidder will be announced by the Indian government. The entire process is expected to take at least two months from the last date of submission, given the various stages of scrutiny and approvals required. Meanwhile, the pre development work for the airport has just started. The airport area has been divided into four zones for the pre development work. While zone three and zone four are being developed by Gayatri Projects and GVK respectively, CIDCO has put up zones one and two for re-tendering. This process is expected to be over in about one and a half months’ time. The river Ulwe cuts through zones one and two and will need to be diverted before work can begin there. In zones three and four, there is a hillock 92 metres high and which needs to be cut to a minimum of at least 8 metres. The process of land acquisition is ongoing with about 75% of the land required for the core airport area – 1,160 hectares – already complete. The acquisition for the remaining 25%, or about 292 hectares, is still underway.
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India
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L&T Q2 PAT up 84% Larsen & Toubro reported an 84 per cent year-on-year rise in Q2FY17 net profit to Rs 1,434.63 crore, helped by a divestment gain of its general insurance business, other income and lower finance costs. Adjusting for the one-time gain, profits grew at 41 per cent year-on-year to Rs 1,032 crore. Total order inflow during the quarter increased 11 per cent y-o-y to Rs 31,119 crore. The order book for the group also increased 4 per cent y-o-y with a total order book of Rs 2.51 lakh crore. The top line for the quarter increased 8.2 per cent y-oy to Rs 25,010.70 crore, boosted by the company’s infrastructure, power, hydrocarbon and financial services business lines. The bottom line was boosted by an increase in one-time gains to Rs 402.43 crore compared with Rs 45.69 crore a year ago.
Mumbai University gives way for better connectivity at BKC The University of Mumbai has decided to hand over 34,715 sq. meters of land to Mumbai Metropolitan Regional Development Authority (MMRDA) which will be used for de-congesting the area around the important business district of the city – the Bandra Kurla Complex. MMRDA will be constructing 1.2-km long elevated road with 2+2 lanes from Bharat Diamond Bourse Junction in BKC to Vakola Junction near WEH. For the purpose, Mumbai University will hand over a land measuring18,834 sq. meters to MMRDA. MMRDA will construct 400-m long and 30-m wide road in the vicinity of Mumbai University for additional connectivity from BKC to SCLR. For the purpose, Mumbai University will hand over a land admeasuring15,881 sq. meters to MMRDA.
The transfer and development (TDR), generated after handing over of the land to MMRDA, will be sold and used for the overall development of Mumbai University which will include construction of hostels, staff quarters, guests house, science block etc. in an area of 3 lakh sq. meters approximately. A joint statement was issued by UPS Madan, Metropolitan Commissioner, MMRDA and Sanjay Deshmukh, Vice Chancellor, Mumbai University on the issue. MMRDA, in its pursuit to provide better connectivity to ever developing BandraKurla Complex, is constructing a few flyovers like – one from Bandra-Worli Sea Link to BKC, which is aimed at providing signal-free, it will be Rs 253 crore.
Financiers express interest for Mumbai-Nagpur super expressway Maharashtra State Road Development Corporation – the nodal agency for the Rs 46,000-crore Mumbai Nagpur Expressway – is in talks with SBI Caps and lenders like State Bank of India (SBI) and IDBI Bank to fund the project, according to senior bankers and government officials. A host of sovereign wealth funds have also evinced interest in part-funding this project. According to a banker, representatives from SBI caps and SBI had met MSRDC officials to discuss the proposal. Confirming the development, Radheshyam Mopalwar, vice-chairman and managing director, MSRDC said that it has sent the proposal to government and is awaiting approval. “SBI caps is proposing to be the arranger
and will bring in seven to eight banks on board. They are already in discussions. Now we will soon officially sign up with SBI Caps,” he explained but declined to disclose the names of interested foreign investors. SBI Caps recently informed MSRDC that foreign investors are interested in the project.“We require $4 billion. Our engineering cost is around Rs 27,000 crore and SBI Caps is giving some
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indicative figures what they can get us from the domestic market but let’s see what the exact amount is,” Mopalwar said as per reports. The Nagpur-Mumbai Expressway, also called the Maharashtra Samruddhi Corridor is the first project in Maharashtra being set up by pooling land rather than by acquiring it. This is the first effort to get into partnership with the farmers, wherein we are giving them developed land more than even what a real estate developer would offer. Since, the land being offered is along the 24 inter-changes planned along the highway, the value realisation of the land on completion of the project will be exponentially higher. It will be a 710-kilometre long fourlane super fast expressway reducing time from 16 hours to just 8 hours.
cover story
Shifting
Gears A
ll of a sudden, it’s good times once again in the roads sector. Withs while aggressive bidding, land acquisition, right of way (RoW) issues, etc., all combined to usher in a phase of weak growth in the past, resulting in fewer projects being awarded, and investor interest turning lackluster, the situation, of late, seems to have changed for the better. The speed bumps are being evened out. To start with, the number of projects awarded by both the Ministry of Road Transport and Highways (MoRTH) and the National Highway Authority of India (NHAI) are gaining pace. Not only this, the number of kilometres constructed per day has also improved considerably. Especially after a short period of lull while the monsoon lasted. Compared to 362 km, 367 km and 315 km respectively in July, August and September, construction of these roads
Roads construction is gaining pace. The new hybrid annuity model can drive private participation.
in October stood at 612 km or 20.4 km/ day. In the first three months of the current fiscal, highway construction had been at relatively brisker pace, at 464 km, 711 km and 760 km, respectively. Construction activity generally remains high during the October-June period. Over the last year itself, there has been a pick-up in awarding road projects due to multiple factors like introduction of the hybrid annuity model (HAM) and certain developerfriendly regulatory measures by the ministry. These measures, which were aimed at improving participation of the stakeholders, have begun to pay dividend. The efforts resulted in road awards crossing 10,000 km during FY16, a sharp jump from 8,000 km awarded in FY15. The ministry now expects to capitalise on the improved sentiment and it has raised its awarding and construction targets multi-fold.
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In the last 18 months, 13,000 kilometres of roads have been awarded between MoRTH and NHAI. Along with the National Highway and Infrastructure Development Corporation (NHIDCL), the joint target for FY17 is 25,000 km (15,000 km by NHAI and 10,000 km by MoRTH and NHIDCL). This is a sharp jump of 2.5 times the FY16 award numbers. While these numbers so far are a marked improvement from the past, however, given the pace of awards in the first six months of the current financial year, industry players are sceptical that MoRTH and NHAI will be able to meet their targets for this financial year. In fact, the number of kilometres awarded during April to September 2017 (3,969 km) is a good 11% reduction over the kilometres awarded in the six months to September 2016. The target set for NHAI by MoRTH was 15,000 km at
the start of the year. However, Raghav Chandra, former Chairman, NHAI, told Construction Times that the authority would award about 6,500 km by the end of this fiscal. “We will bid out over a lakh crore worth of road projects but the actual awards would be worth about Rs 70,000 crore,” Chandra said. Nonetheless, the order flow in the coming months and year is now likely to be driven by the EPC route. And although this would be beneficial to the industry as a whole, it would significantly benefit players who have a strong foothold in the EPC space and have strong balance sheets to bid for large contracts. In fact, Nalin Gupta, Managing Director, J Kumar Infraprojects said that the order book at his company stands at historically high levels, given the thrust on infrastructure projects by the current government and thanks to the increased pace in projects being awarded. “We are at Rs 10,000 crore plus order book as of now and these have come only from the engineering, procurement and construction (EPC) segment. Along with the metro projects, we have also seen ordering from the roads ministry and NHAI,” Kumar said. Varun Mehta, CFO, Sadbhav Infrastructure Projects, expects things to improve even more. “The legacy issues of land availability, etc., are getting resolved as well, which means the execution of projects will also gain further momentum,” he points out. Nonetheless, infrastructure developers are still scrutinizing the newly introduced hybrid annuity model
“We will bid out over a lakh crore worth of road projects but the actual awards would be worth about Rs 70,000 crore.” - Raghav Chandra, Former Chairman, NHAI
(HAM) and they are yet to overcome their initial scruples pertaining to the model. Although the HAM is uncharted territory, it is likely to attract participants in the coming years. In FY16, NHAI awarded 350 km of projects on the HAM mode. However, a significant number of projects are likely to be awarded during the coming months and year. This model is being considered as a win-win situation for both the build, operate, transfer (BOT) players as well as the authorities. While authorities can award a project by investing 40% (100% outlay by authorities in case of EPC), BOT players can now take up projects with 60% investment (100% in case of BOT). Additionally, the toll risk is completely removed. However, the lowering of risk comes at the cost of relatively low returns from HAM projects. Although BOT has its inherent issues, it is likely to provide stronger returns for higher risk compared with EPC and HAM. While the higher return on investment is what drew developers to the BOT models, the risks associated with land acquisition, and hence delays in construction and variability in traffic during the operational phase, hit the companies hard. In comparison, HAM has limited downside for developers compared with BOT, but the returns are
“We are at Rs 10,000 crore plus order book as of now and these have come only from the EPC segment.” - Nalin Gupta, Managing Director, J Kumar Infraprojects
limited, too. The annuity amount will be adjusted to inflation upon completion of construction. Also, maintenance payments will be linked to inflation annually. Both these factors are positive for hybrid annuity project developers compared with the BOT annuity model where the major maintenance cost is open to inflationary impact, while the annuity inflow is fixed. Besides positive developments on funding and operating costs in HAM, the NHAI has also addressed some issues that plagued BOT projects, mainly with respect to timely availability of right of way and required approvals. As for right of way, the NHAI will be handing over 80% of continuous stretches before signing the concession agreement. The remaining will be given within 180 days failing which, that portion will be removed from the scope of work of the NHAI. If there are delays from NHAI in providing clearances that, in turn, delays project execution, it will lead to the extension of the concession period in proportion to the delay. Furthermore, a part of NHAI’s own funds will get blocked if there is a delay in construction because it is financing 40% of the project cost. As of early October, NHAI’s bid pipeline stood at 2,245 km (worth Rs 268 billion) with most of the bids likely to be opened in the near future. This pipeline has a large portion of the HAM segment, considering the government’s intention to push the new business model. “The HAM road projects are a good way for any serious company to build their order book,” said Rajat Seksaria,
December 2016 | CONSTRUCTION TIMES | 19
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VP and business head, Punj Lloyd Infrastructure. “The government has come out with a model that provides an opportunity to move towards a more sustainable business model with assured returns,” he added. Indeed, the share of HAM projects is only expected to increase in the coming times, given the government’s focus on improving private participation in the sector and managing its own resources efficiently. While it is early days for this business model, it provides good scope, especially for BOT-focused players. Today, the split between rail and road transport in freight and passenger traffic is heavily skewed in favour of road transport. As of 2011-12, road transport is estimated to have held 69% and 90%share in freight and passenger traffic respectively. The share of freight traffic is expected to decline from 69% in 2011-12 to 65% levels in 2016-17 which is still huge. Therefore, development of road transport is going to be crucial to
“The HAM road projects are a good way for any serious company to build their order book.” - Rajat Seksaria, VP and business head, Punj Lloyd Infrastructure
support freight traffic in the country. In order to improve road infrastructure, the total outlay for roads and highways was pegged at Rs 970 billion for FY17 in the Union Budget whereas outlay for the infrastructure sector on the whole was pegged at Rs 2,212 billion. The outlay for roads includes allocation from the Ministry, tax free bonds by NHAI of Rs 150 billion, and Rs 270 billion under the Pradhan Mantri Gram Sadak Yojana (PMGSY) Given the above outlays, a huge opportunity is ready to unfold in the next few years. The Government of India has delegated NHAI with the responsibility
“The legacy issues of land availability, etc., are getting resolved as well, which means the execution of projects will also gain further momentum.” - Vrun Mehta, CFO, Sadbhav Infrastructure Projects
20 | CONSTRUCTION TIMES | December 2016
of implementing the national highway development programme (NHDP) programme spread over seven phases. At the moment, NHDP is being implemented in all phases except phase VI. Road projects to the tune of 12,000 km are yet to be awarded under the current NHDP programme. (A majority of this would be driven by NHDP phase IV, which envisages upgradation of National Highways). The slowdown of the economy during 2008-09 may only be a distant memory when road developers really felt the heat as aggressive bidding took its toll on these players and projects had to be terminated due to lack of funds and other issues such as clearances. But companies still need to guard against these ills that plagued the past, lest they burn their fingers again and participation from private players plummet. There is a sustainable business model in place now and an improved regulatory framework. The stage is set for history not to repeat itself. n
cover story
Interview
MSRDC has not defaulted even for a day Radheshyam Mopalwar, VC & MD, Maharashtra State Road Development Corporation, tells CT there is interest from both domestic and foreign institutions to finance the showcase Nagpur-Mumbai super expressway project. The Nagpur-Mumbai project has been discussed for a long time. Have you found the means to finance it yet? We believe you have signed up with SBI. SBI and SBI Capital Market are still not officially with us. SBI Caps has sent an official proposal and we have sent it to the government for approval. We feel that for a project of such magnitude, it is right for the government to have a view on this. Will the entire amount be financed by banks or will you look at other alternatives also? Yes, there are other options also like the multilateral funding agencies. With respect to banks, aren’t they a bit reluctant to do infrastructure financing right now? See, I have many discussions about this with financiers and my view is that you have gone to my neighbours and financed those bad assets in the private sector. You failed there and created non performing assets (NPAs), so how can you blame me for that? You financed blue chips but there were assets that were highly compromised and maybe you were even involved in that compromise. It is your DGM or GM who was sitting on the lenders’ committee, not mine. In the last 20 years, MSRDC has not defaulted even for a day. You cannot compare oranges with apples. The failure of financing in the private sector is very different as compared to the public or government
sector. So you certainly cannot say that there is a collective failure. We understand the government wanted to achieve financial closure by October-November for this project How much longer do you expect you will take to get closure? Well, there is no financial closure required as such for an EPC project but the intention is to tie up the means of finance before we award the work. If we award a certain strect of work, some margin money will obvioulsy be required so that the contractors are also reassured. Now whether we will raise finance through bonds, multilateral agencies, or monetise some land aseets,
22 | CONSTRUCTION TIMES | December 2016
these are the options before us. So which portion of this entire mix of finance are you inclined towards currently? We will have to mix all sources. No one single source has this kind of money or will finance the whole thing. SBI Caps is proposing to be an arranger and they will bring in seven-eight banks on board. IDBI is anyway a part of it. SBI Caps will syndicate. The moment there is an arranger, I don’t have to go to each bank separately by myself. What about monetising land? That is not a means of finance for
this project. What I meant is it is the icing on the cake. For monetisation, we have already some 1000 acres of land lying across Mumbai-Pune expressway. We are proposing to monetise this over the next few years and this process has been given a formal structure by the government, comprising the PWD secretary and others. Maybe, the monetisation could help during the period of construction of the expressway but we are aware that monetisation over a longer tenure will fetch more money. So, maybe we will use the proceeds for debt servicing at a later date since infrastructure debts are not sustainable for 15 years. These options are being looked at. How much are you planning to raise from the monetisation that you are talking about from the Mumbai-Pune expressway? Not just Mumbai-Pune, there are others as well. The proposition is to monetise lands and raise finances over a period of 15 years to the tune of about Rs 15,000 crore. This is not going to be begin right away and I actually do not think we will do anything even in the next five years but there is a master plan that is being put in place. See, the idea is not to go ahead and do a distress sale in a distress market. By when will SBI Caps come out with some kind of solution? They will come forward. They have given us some indications but please understand that there is no point quoting informal figures. Sufice to say they are confident of raising huge money and we should get both domestic and international financiers. Plus as I said, on the multilateral agencies, Asian Development Bank has indicated very strong interest. We are meeting with them. Their proposal has to be ratified by the Deparment of Economic Affairs (DEE). Who all are interested?
A number of sovereign funds are there as well many other investors. We have said we are not capable of examining their credentials and hence someone from the sector will do all this for us, the due diligence, investment structuring, etc. It could E&Y, it could be KPMG, it could be BCG. Basically, it has to be someone of that calibre. And they will come in with legal partners like Zia Mody or Cyril Amarchand Mangaldas, etc. Lately, we’ve seen Canadian pension funds very active in the roads sector here. Will they come in here? They don’t do greenfield. They usually come in at a later stage, for asstes that have encashable values, and which are transparent. In fact, we have had a talk with them for the Bandra Worli sea link. For the Bandra Worli sea link? Yes, I have to raise finance for it. I have outstanding liabilities on it. The government has instructed the Municipal Corporation of Greater Mumbai (MCGM) to buy the remaining concession period from us. This money is to be used for our Bandra Versova sea link project when it commences.That project is going to cost Rs 7,500 crore
and there is no viability gap funding. I cannot securitise at a lower rate. My net present value (NPV) of the balance period of 24 years is Rs 2,800 crore but I cannot raise the entire amount as the bankers are not comfortable with such a long tenure. I can monetise for 15 years but that leaves me with a shortfall of about Rs 1,500 crore for the Bandra Versova sea link. This is why something like a pension fund is a good fit for this project. What about the land acquisition under the new land pooling model, proposed for the first time in Maharashtra for the Nagpur Mumbai project? Are the farmers coming on board? Well, supposing we get only 50% of the land that we require under land poooling, in any case, the government can outright acquire the remaining half. But we want to involve the farmers in the growth that we expect along the highway which is a very interesting project. This is the first of its kind project in India and we believe the local population have a right to be a part of the growth story. The process of education and counselling in going on right now and we are quire encouraged with the response in many areas along the route. ď Ž
December 2016 | CONSTRUCTION TIMES | 23
cover story
Analysis
New
Roads, Challenges
Highway building improves, but many projects are still hobbling.
C
RISIL’s analysis of 85 underconstruction and 104 operational BOT (build operate and transfer) and annuity projects awarded by the National Highways Authority of India (NHAI), which together span 16,600 km, shows there has been a 13% reduction in high-risk projects over the past fiscal. These risks pertain to completion (for under-construction projects), and debt servicing ability (for operational ones). Things look much better in terms of pace of construction, which improved 40% from an average 4.3 km per day in fiscal 2015 to 6 km in fiscal 2016. The material improvement in the pace of execution can be attributed to policy reforms by the NHAI and facilitations by the government, which are also reducing delays. Given this, we expect the average construction per day for NHAI projects to nearly double to more than 11 km by fiscal 2018. The key policy reforms initiated include
easing of the clearances process, ensuring 80% land acquisition before the award of project, premium rescheduling, allowing developers to fully exit operational road projects, and introduction of the hybrid annuity model. Given that these reforms are largely aimed at reducing risk, private participation is set to pick up.
operations date (PCOD) stage, but are still unviable due to cost overruns and weak sponsors. These projects need a whopping 60% revenue growth to meet debt service requirements. Refinancing, debt restructuring, premium deferment or acquisition by a stronger sponsor are the only solutions.
Within the 85 under-construction BOT projects, there has been a 10% reduction; however, as much as 4,600 km of projects are still in the highrisk category because delays in land acquisition and approvals have increased costs by 20% or Rs 11,000 crore, and the financial health of sponsors remains weak. These stuck projects were largely awarded during fiscals 2009-2012 and the mitigation options for them include a one-time fund infusion through NHAI loans, and a change in sponsor.
CRISIL’s analysis of the 104 operational projects also shows a significant 18% reduction in both length (to 2,700 km) and outstanding debt (to Rs 19,650 crore) of high-risk operational BOT projects compared with 2015.
Of the 4,600 km high-risk underconstruction projects, 1,400 km has reached the provisional commercial
24 | CONSTRUCTION TIMES | December 2016
Consequently, 65% of the operational portfolio has a debt service coverage ratio of over 1 times compared with 55% a year back. This is largely due to healthy traffic growth, averaging over 12%, and reforms like the 100% exit clause in projects and NHAI premium deferment. Refinancing of debt by low cost longer tenure loans has also played a large role in credit improvement of these projects.
CRISIL estimates that over the next two years, stronger developers will be able to raise funds for their under-construction portfolio through stake sales in their operational portfolio and from investment trusts. However, weaker developers still face a funding gap of Rs 6,300 crore, equivalent to around three-fourth of funds required for their existing portfolio. CRISIL believes the hybrid annuity model has a lot of potential since the developer is fully insulated from traffic risk and partly from inflation and interest rate risks. The award of projects through this mode would kickstart private sector participation, as 60% of the funding for these projects has to be arranged by the developer However, bidding aggression, both on project cost, and operations and maintenance parameters, and funding mix for hybrid annuity projects needs to be closely monitored. Our assessment indicates that around one- quarter of the projects awarded so far could face challenges in debt servicing. Positive impact of last year’s reforms In October 2015, we had underscored how, of all the policy reforms announced for operational projects, the removal of restriction on exit clause was likely to have the maximum impact. This afforded change in management and improved access to better refinancing terms. Four projects that were dubbed high risk are now in the low-risk category with new managements stepping in and wrangling favourable terms on refinancing.
Four others were also refinanced at a lower cost, which improved their debt servicing ability and hence credit profiles. In addition, the government has approved partial deferment of premium payment for projects that were bid at a high premium and are facing difficulties in honouring debt obligations. This has turned a high-risk project into a low risk one. CRISIL had also mentioned that the gains from the Reserve Bank of India’s 5:25 scheme will be limited since most operational highways had shorter concession periods. Not surprisingly, no project has qualified under this scheme yet. With improvement in traffic and implementation of reforms, the removal of restriction on exit clause and premium deferment, 12 formerly high risk projects with debt of Rs 5,930 crore are now expected to become viable. However, for those at risk, timely
support from sponsors remains crucial to meet operating expenses and debt obligations. CRISIL believes successful implementation of reforms, especially the 100% exit clause and refinancing thereafter, can further improve and strengthen the credit profiles of operational BOT projects. This will also help road developers raise funds and ease their financial position to some extent. Will the hybrid annuity model be a game changer? Developer participation in the BOT model of road construction has reduced with the average number of bids from 25 in fiscal 2011 to 6 in 2016. That’s because of the stretched financials of developers and their limited capacity to take up new projects. The NHAI introduced the hybrid annuity model to encourage private participation. The model reduces upfront equity infusion required by developers because 40% of the project cost is funded by the NHAI. The authority will also provide fixed annuity payouts and cover operating as well as interest costs during the operational phase, which further reduced the risk for developers. With a target of 3,000 km to be awarded on hybrid annuity basis in fiscal 2017, this model will cumulatively reduce the public funding requirement by Rs 18,000
December 2016 | CONSTRUCTION TIMES | 25
cover story
Analysis
crore compared with the EPC model. Simultaneously, for the developer, the equity requirement would reduce by 40% to Rs 5,400 crore compared with Rs 9,000 crore in BOT toll or annuity models for the same length. In the construction phase, with the NHAI funding 40% of the project cost, the equity infusion requirement and the debt burden of stretched developers will reduce. In the operational phase, developers will have steady cash flows through annuity receipts, interest income on balance annuity payments, and operation and maintenance (O&M) cost payout. While the total annuity
payout would be adjusted one time for inflation after the construction period, the payout for O&M cost will be adjusted for inflation annually. More Hats In The Ring, But Aggression Can Backfire Given the slow movement in the award of BOT toll and annuity projects, we are seeing some aggression in hybrid annuity projects with some mid-sized and small developers also taking up projects. CRISIL analysed the hybrid annuity projects awarded till date and found that around one-quarter of the projects could face challenges in debt servicing.
There has been an increase in the average number of bidders from 3 earlier to 10 now. Bids, in some projects, have been aggressive compared with the NHAI’s own base project cost and normative operations and maintenance costs for road stretches. Though the equity requirement has reduced, these mid-sized and small developers’ ability to get the required equity money in a timely manner will remain the key monitorable. Also their ability to provide financial support in case of cost overruns and cash flow mismatches could hamper execution and hence viability. Beyond that, risks pertaining to delays in clearance and higher leverage will persist even in this model. Overall, the hybrid annuity model seems to be an attractive option for developers though there could be risks emerging from aggressive bidding. Furthermore, implementation of reforms as regards land acquisition and approvals will play a key role till projects under this model are commissioned. Till then, developers should stay cautious during bidding to avoid bruising their financials, as it had happened between fiscals 2010 and 2012. n This article has been authored by CRISIL
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cover story
Case Study by rock breakers and environmental safety norms had to be strictly followed. This highway project also involved building several structures, including four twin-tube tunnels, apart from 76 bridges/viaducts and underpasses, 223 culverts, 10km of retaining wall and 27km of breast wall.
Fastest hill road executed on JammuUdhampur Highway
W
orking in extreme conditions, AFCONS Infrastructure Ltd executed one of the most challenging road projects in Jammu & Kashmir. This National Highway-1A (NH1-A) made into made the travel time come down to 45 minutes from two-and-a-half hours time between Jammu and Udhampur. In the National Highway Authority of India’s (NHAI) history, this is the fastest hill road project ever to be executed by an Indian infrastructure company.
The project was appointed as EPC contractor by SP Jammu Udhampur Highway Private Ltd., who is the concessionaire for NHAI to convert the Jammu-Udhampur road to a four-lane highway. SMEC International Pty Ltd. is the independent engineer for this project. The NH-1A connects cities of Jalandhar (Punjab) with Uri (J&K), it traverses through Jammu and Udhampur and then Srinagar. The NH-1A connects important Army and Air bases in the state of J & K. It also serves as the main pilgrimage and tourist route for pilgrims going to Vaishno Devi and Amarnath, tourists going to Kashmir valley and further upto Leh.
Project Details The 4-laning Jammu-Udhampur Highway Project is a part of NH-1A that originates at Jalandhar and terminates at Uri covering Pathankot (Punjab), Jammu, Udhampur, Patop, Batote, Banihal and Srinagar. The starting point of present project section has been fixed at Km 15.000 of Jammu Bypass and ends at Chainage Km 67.000 of NH1A traversing through Nagrota Bypass, Nandini wild life and Udhampur Bypass. The total length of this road section is 64.579Km. Challenges For Execution Unlike any other conventional road project in plain area, this project is a hill road project executed by AFCONS for the first time, with its own unique features. In this project, survey, finalisation of plan and preparing the profile was an exhaustive exercise because of the complicated terrain and strict design stipulations on speed and geometrics. The highway is in a hilly terrain in the sensitive state of Jammu & Kashmir, where blasting was not allowed during construction. Excavation had to be done
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Major Value-Engineering Innovations To tackle the above challenges successfully, AFCONS introduced many value-engineering innovations. Some of the key innovations are like • At few locations, it is found that the heights of abutments are very high with major quantity of backfilling. In such structures it is economical to add additional spans to reduce height of bridge abutments, filling in approach and return walls. The span arrangements of such structures are configured to increase the length of bridge. • Box girders are replaced by ‘I’ girders in some structures to make use the available bridge building technology to have ease and speedy construction • There are considerable number of multi-cell box culverts that are changed to 20M standard span bridges to have an ease, speedy construction and standardisation. • Use of box culverts in place of slab culvert for reduction in quantities and more resistant to differential settlement. • Combination of RE wall and RCC wall for high retaining wall more than 10M for speedy construction. • Extensive use of Neoprene bearings in as many bridges that are being proposed with standard 20M span to make the road within the available ROW, to meet design requirements and to avoid fouling of some existing structures. n
BAUMA CONEXPO India
Event
Big Names From Construction Equipment Industry Sign Up For BAUMA CONEXPO INDIA 2016 I
ndian construction and construction equipment industries are all geared to converge for the largest networking event of the year. The BAUMA Conexp India 2016 to be held from December 12-15 at New Delhi will, like the past year, be the largest networking event for the booming construction industry of India. Last year, global sales of construction machinery declined more than 10 percent compared to 2014. Now the British economic forecast and market research company Off-Highway Research is predicting significant growth again in many important national markets. In concrete terms, analysts expect that more than 46,000 units could be sold in India this year—after some 39,000 units in 2015. According to OffHighway Research, the Indian market could account for more than 80,000 sold construction machines in the year 2019. GDP from construction in India increased to Rs 2290.92 billion in the second quarter of 2016 from Rs 2285.27 billion in the first quarter of 2016. GDP from construction in India averaged Rs 1990.66 billion from 2011 until 2016, reaching an all time high of Rs 2377.80
Billion in the second quarter of 2015 and a record low of Rs 1736.49 billion in the third quarter of 2012. The venue with a total area of 150,000 square metre space is expecting around 750 exhibitors and 30,000 plus business visitors. This is the fourth time that the International Tarde Fair for construction machinery, building material machines, mining machines and construction vehicle is being held in India. The three-day event is being organized by the Builders’ Association of India (BAI), the Indian Construction Equipment Manufacturers’ Association (iCEMA), the International Powered Access Federation (IPAF), Construction Times and Construction Opportunities. Other than the exhibition, attendees will also have access to conferences, lectures and trade events. The event will also be platform for understanding the emerging growth trends in the Indian infrastructure. Lectures and conference will cover areas such as “Reviving infrastructure—New paradigms”, “Rural Infra—Bringing Bharat closer to India”, and “Holistic equipment solutions—Current need of
the hour for Infra growth”. The event is directed, for example, at construction firms, government authorities and departments, technical experts and also manufacturers of equipment. The event is timely as PM Narendra Modi’s government has committed to increase its focus and investment on the infrastructure requirement of the country. The government has increased its infrastructure spend by 22 per cent over the next two years. With the Indian economy one of the fastest growing economy in the world, analyst and experts, are expecting huge potential for construction and allied sectors. According to the Construction Equipment and Building Material Machinery Association within the Verband Deutscher Maschinen- und Anlagenbau (VDMA—German Engineering Federation), India is currently the only Asian country able to point to a growing construction machinery market. Infrastructure development is commonly held to be the driving force behind this development. The Indian government and international development banks are making billions available for new roads, bridges, sea and airports, as well as railway and energy projects). According to the German foreign trade and inward investment agency, Germany Trade & Invest (GTAI) data, for example, expressway construction in India in 2016/17 is to be expanded to 15,000 km compared with 6,000 km the year before. This is not all, the British market research company Off-Highway
30 | CONSTRUCTION TIMES | December 2016
Research envisages that approximately 55,000 construction machines are expected to be sold in India in 2016 climbing steadily to more than 71,000 units by 2020. The top sellers, with a combined market share of over 90 per cent in 2020, are expected to be backhoe loaders, crawler excavators, mobile cranes, mobile compressors, compactors and wheel loaders. Igor Palka, CEO of bC Expo India, which organizes BAUMA CONEXPO INDIA, in a statement said: “We have registrations from big names like ACE, Ajax Fiori, Ammann Apollo, ASTEC, BAUER, BKT, Columbia Machines, Haulotte, Herrenknecht, Hyundai, Kobelco, KYB Conmat, Liebherr, Linnhoff, Liugong, Macons, MAN, Marini, Masa, Potain, Puzzolana, Sany, Schwing Stetter, Soilmec, Topwerk, Wacker Neuson, Volvo or Wirtgen. That’s a pretty impressive cross-section of the industry.” That view is shared by Dimitrov Krishnan, Vice President and Head of Volvo CE India: “We are looking forward to BAUMA CONEXPO INDIA 2016 and are expecting a number of visitors to our booth from North India, which has been an area of focus for the government, and where infrastructure development is expected to pick up even
further in the coming months.” Players such as Caterpillar, JCB, Potain, Putzmeister, TIL and XCMG have also applied to the show. Among the prominent names that would be making their debut for the event for the first time include Comacchio, Kubota and L&T and Komatsu. Past Experience The exhibition held in 2014 was a grand success, the exhibitors were particularly pleased with the quality of the trade visitors. Sorab Agarwal, Executive Director of ACE, enthused: “We had visitors from all over India but also international ones. We only had genuine customers—there was no wasting time, they were here for business” and Tanmay Majumdar, Associate Vice President of Gmmco/Caterpillar, added: “The quality of visitors was very high, including good buyers, contractors and the like. bC India is a good opportunity to meet new customers.” bC India also enjoys a very high status as a presentation platform for companies, as Sandip Choudhuri, General Manager & Head Kansbahal Works at Larsen & Toubro, confirmed: “We had many customers and very serious enquiries. The visitors were very seriously interested
in our products. We launched a new product here and in that respect it was very important for us to be here to use bC India as a platform.” For Wirtgen, too, bC India is a must. Ramesh Palagiri, Managing Director & CEO of Wirtgen India, commented: “bC India is very important for the Wirtgen Group. Here in India, bC India is the most professional trade fair. We’ll participate in the next bC India, too.” As well as high quality, bC India also provided an excellent opportunity for signing up new business as Rajesh Shrivastava, General Manager,Marketing & Dealer Development of Terex India, confirmed: “We had customers coming and buying equipment right off the booth. We are very excited about the profile of the customers here at bC India.” All Hopes According to the Indian Construction Equipment Manufacturers’ Association (ICEMA), the upswing will primarily be driven by the road construction and earthmoving sectors during the next two to three years. And so one can see that there is lof of activity on the Indian market, which is good news for the exhibitors and visitors of the upcoming BAUMA CONEXPO INDIA. n
December 2016 | CONSTRUCTION TIMES | 31
BAUMA CONEXPO India
Event
Construction equipment industry set to converge
B
AUMA CONEXPO INDIA 2016 is going to be held at HUDA grounds in Gurgaon / Delhi from December 12 to 15. Numerous big names in the industry already signed up for the exhibition. The show will set the perfect backdrop for those dealing with construction and the construction equipment sectors to gauge the current mood of the market along with finding the right mix of attendees to interact and deal with, under a perfect ecosystem at the venue. Why does such a show matter to the Indian and global market? According to the Construction Equipment and Building Material Machinery Association within the Verband Deutscher Maschinenund Anlagenbau (VDMA - German Engineering Federation), India is currently the only Asian country able to point to a growing construction machinery market. Infrastructure development is commonly held to be the driving force behind this development. Even the German foreign trade and inward investment agency, Germany Trade & Invest (GTAI) data, expressway construction in India in 2016/17 is to be expanded to 15,000 km compared
with 6,000 km the year before. With a view to current conditions and all currently foreseeable factors, the British market research company Off-Highway Research arrives at a very favourable forecast for the next five years as well. It envisages approximately 55,000 construction machines to be sold in India in 2016 climbing steadily to more than 71,000 units by 2020. The top sellers, with a combined market share of over 90 per cent in 2020, are expected to be backhoe loaders, crawler excavators, mobile cranes, mobile compressors, compactors and wheel loaders. This means for all those who are connected to the infrastructure, construction and realty sector. A show of this nature not only helps various exhibitors, but also helps engage with industry experts, associations and visitors. This will help gauge the momentum that is building up in this sector. Bauma is already overwhelmed with the response a has been getting from stakeholders so far. In fact, expressing his delight with the response from exhibitors, Igor Palka, CEO of bC Expo India, which organises BAUMA
CONEXPO INDIA said, “We have registrations from big names like ACE, Ajax Fiori, Ammann Apollo, ASTEC, BAUER, BKT, Case, Caterpillar, Columbia Machines, Haulotte, Herrenknecht, JCB, Kobelco, KYB Conmat, Liebherr, Linnhoff, Liugong, Macons, MAN, Marini, Masa, Potain, Putzmeister, Puzzolana, Sany, Schwing Stetter, Wacker Neuson, Volvo , and Wirtgen, XCMG for the show.” Even at the international level, the interest in the show remains unbroken as Mr. Igor Palka points out: “Joint booths from China, Germany, Italy, North and South America as well as Spain are already currently registered. A total of 28 countries will be participating at the event. That clearly shows how important BAUMA CONEXPO INDIA is for international companies.” The India growth story too has had a positive impact on show. Over the years, BAUMA CONEXPO INDIA has been getting bigger and footfalls and audience too have widened with every successive show. This has had a direct impact on need for a bigger venue. Hence as a part of expansion plans we is organising the 4th edition of the show at HUDA Ground / Sector 29 Gurgaon. The venue will provide with a total area cover of 150,000 square meter space. The new venue also offers the visitors and an exhibitor an easy access to the show. The Gurgaon exhibition venue is just 20 minutes away from the domestic and Iinternational airport. This is expected to provide relief to those visiting Delhi just for the show, immediately. The venue is located closely to numerous hotels ranging from high end to budget hotels at very close vicinity. They too are well connected by roads and public transportation. In fact the IFFCO Chowk Metro Station is just next to the ground. Above all, the sheer size and the experience of working on this venue has being overwhelming.
32 | CONSTRUCTION TIMES | December 2016
The December Expo is expected to showcase around approximately 700 exhibitors and will receive around 30,000 plus business visitors. Bauma Conexpo India BAUMA CONEXPO INDIA, the international trade fair for construction machinery, building material machines, mining machines, construction vehicles and construction machinery is being held for the fourth time from December 12 to 15, 2016 at the HUDA grounds in Gurugram/Delhi. The last event, held in in Greater Noida/Delhi in December 2014, was attended by 635 companies from 25 countries and 26,018 specialist visitors. BAUMA CONEXPO INDIA is held every two years.Messe München construction machinery trade fairs In addition to holding the worldleading bauma trade fair, Messe München has a wealth of experience when it comes to organizing other international construction machinery trade fairs. Along with bauma China in Shanghai, Messe München together with the Association of Equipment Manufacturers (AEM) organizes BAUMA CONEXPO INDIA
in Gurugram/Delhi and BAUMA CONEXPO AFRICA in Johannesburg. In December 2015, Messe München successfully expanded its portfolio again by purchasing the leading Russian construction machinery exhibition CTT. Messe München With more than 40 trade fairs of its own for investment goods, consumer goods and new technologies at the Munich site
and abroad, Messe München is one of the world’s leading trade fair organizers. Every year, more than 30,000 exhibitors and around two million visitors take part in the events at the trade fair site, at the ICM - International Congress Center Munich and at the MOC Event Center Munich. Messe München also organizes trade fairs in China, India, Turkey, South Africa and Russia. With a network of associated companies in Europe, Asia and Africa, and with over 60 representatives abroad for more than 100 countries, Messe München has a truly global presence. Association of Equipment Manufacturers (AEM) The North American association AEM represents the interests of the manufacturers of commercial and offroad vehicles on an international level. Based in Milwaukee, Wisconsin, the association has offices in Washington DC, Ottawa, Canada and Peking, China. AEM represents over 850 companies from the agriculture, construction, forestry, mining and supply sectors. AEM is the joint owner or organizer of various internationally recognized trade fairs including CONEXPO-CON/ AGG, one of the world’s most important meeting places for the construction and construction material industry. n
December 2016 | CONSTRUCTION TIMES | 33
BAUMA CONEXPO India
Interview
“Demand should pick up from CY2017.�
What is the growth likely with the expansion of capacities in mining and construction, especially in the wake of amendments to the Mining Act and a general ease of doing business? The amendments in the Mining Act cover some crucial points. Now, there can be transfer of mining leases; which were granted via non auction procedures and the mineral mined was for captive purposes. This will facilitate many mergers and acquisitions of companies with captive mining leases. The amendment also improves upon the definition of leased area, helping in ease of land acquisition. The government has also started a lot of initiatives to boost mining activities. Online transparent auctions, opening of non-captive commercial mining are some of the initiatives that will help the mining sector. As per industry estimates, by
FY2020; coal mining production will be increased to 1.6 billion tonnes per year and iron ore mining will be increased to about 200 million tonnes per year. Which products would form a major portion of mining equipment financing, considering the high demand likely, owing to the increased applications in industry? Before talking about the equipment for mining industry, it is pertinent to talk about the activities which had hampered the mining production in the last few years. With coal block allocation scam and other hurdles, mining production had slowed down. Mining activities are now seeing a turnaround and we are seeing a pickup in the mining equipment sales. Excavators and dumpers form around 85% of the earth-moving equipment
34 | CONSTRUCTION TIMES | December 2016
sold for mining activities; and going forward, these equipment will continue to be part of our mining equipment portfolio. We also expect increase in the sales of dump trucks with the increase in mining activities, as they are an important part of the mining ecosystem. As per industry estimates, the market for earth-moving equipment for mining increased around 15% in FY2016 and this growth rate is most likely to be maintained for the next couple of years. For the past few months, the mining output has slowed down, as compared to the targets set; but that is due to a small dip in the coal out-take. From calendar year 2017, the demand should pick up once again. With cement players indicating expansion plans, what is the impact on the mining/construction equipment business?
About 60% of cement produced in India is used for concrete production. Ready Mix Concrete (RMC) accounts for hardly 7%-8% of this concrete demand; as compared to developed nations, where it accounts for almost 70%-80% of the demand. The sales of concrete equipment are directly corelated to the growth of the RMC market. Therefore, the scope of growth of concrete equipment is huge. As per industry estimates, market for concrete equipment grew at around 19% in FY2016 and until 2020, the concrete equipment market should grow at a compounded annual growth rate (CAGR) of about 15% - 20%. Infrastructure and manufacturing activities consume about 40% of the cement demand. In the past year, the road sector has seen a lot of traction; giving a boost to the infrastructure activities. The result can be seen in
Devendra Kumar Vyas, CEO, Financial Services, SREI says after long years of inactivity, infrastructure equipment sales have begun to boom. In this chat, he provides an overview of the pick up in demand.
taxation within the country. It promises a unified single tax structure which helps put a curb on the total tax incidence and evasion, and enable free movement of goods within the country. The economic benefit of GST will be all pervasive and the impact on infrastructure should be no different. Depending on the GST rates finalised, the cost of construction materials may go down by 5% to 10%.
the increasing demand for cement. The cement production in FY2015 was around 270 million tonnes, and increased by around 5% in the last fiscal.
What is the role of newer technologies towards creating better efficiencies of cost for the construction and mining business?
In the coming fiscal, cement demand is expected to maintain a rate of 6%. India’s current demand of around 290 million tonnes is way less when compared to China’s consumption of 1400 million tonnes. So, with the increase in the infrastructure activities, we should see an increase in demand for cement and an increased demand in the concrete equipment industry.
Construction and mining equipment are products of heavy engineering. Today, there are a lot of new developments in hardware and software to provide services for maintenance of construction and mining equipment. Telematics is the most prominent of these services. To increase the safety for the labour force and increase the efficient use of the machinery; telematics provide a holistic solution on asset tracking and usage. Construction and mining activities require the machines to work in arduous conditions. Robustness is a critical parameter of the equipment’s design. Data analysis of the existing equipment’s usage will help in better designing and usage of all machinery.
What are the implications of the new GST regime for the construction and mining equipment sector once it is launched by the next fiscal year? GST aims to bring unanimity in taxes and eliminate the hurdles of varied
This should help abate the cost of construction. The real winner will be the real estate segment where both the developer and buyer presently pay a myriad of non-creditable taxes. GST will reduce the cost of construction incurred by the developers and thereby help in reducing the property prices. It will also give a fillip to leasing activity which is currently plagued by both sales tax and service tax being imposed on the same transaction. GST will resolve this problem of dual taxation and a significant beneficiary of this will be the construction equipment segment. Efficiencies in supply chain and logistics, and a uniform tax regime, will further boost the construction equipment sector, which is already witnessing a revival.
December 2016 | CONSTRUCTION TIMES | 35
BAUMA CONEXPO India
Interview
“Growth is steady rather than in spurts” - Rajendra Raina, General Manager, Marketing, Escorts Construction Equipment Ltd, tells CT he believes the industry’s profitability will improve over the next two years.
E
scorts has been a solution provider rather than an equipment manufacturer trying to find a market for its products. It has changed the very face of the industry and processes from time to time by pioneering these products in India. Lall elabrates on the initiatives generated for the construction equipment industry What opportunities have the government’s initiatives generated for the construction equipment industry? A lot of the iniatives are also major projects. Moving from a measly 4 km/ day to 25 km/day as on date, to 40 km plus in the near future is an ambitious target. Debottlenecking the stalled projects kick-started the process and the hybrid annuity model (HAM)
displayed the intent of the government and acted as an accelerator. This led to a major growth in demand for road construction equipment. Year 2015 saw a major growth besides deployment of idle equipment parked with the hirers and EPC contractors. During the first nine months of the current calendar year, the market grew by more than 40 per cent over the same period last year. Rest of the projects will add to the demand of material handling equipment and backhoe loaders in particular. These projects will open up options for new equipment. Have you seen a jump in sales this fiscal? How many units did you sell ?
36 | CONSTRUCTION TIMES | December 2016
The industry we serve showed positive growth ranging between 25 to 40 per cent for their respective product categories during the first nine months of 2016 over the same period last year.Our volumes grew at a rate higher than the market. Prices remain a struggle. The growth is steady rather than in spurts and sustained growth is projected during the next two to three years at least. As the volumes increase further, profitability will grow with better sweating of fixed assets. This will help our suppliers as well as network partners which is a must for the good health of the OEMs. Ultimately, customers stand to benefit as does the economy.
Which sector generates the maximum demand for your products? How superior/efficient are your products? Infrastructure remains the prime mover for our industry. Roads, metro rail, railways, ports, the power sector, irrigation, airports and mines constitute the bulk. Escorts has been a solution provider rather than an equipment manufacturer trying to find a market for its products. From manual to mechanical material handling, static to vibratory roller soil compaction and from manual to backhoe loader excavation, Escorts has changed the very face of the industry and processes from time to time by pioneering these products in India. Our solutions will remain value for money for the customer even as we upgrade our products.
What are the trends in the equipment industry? India is a price sensitive market and will remain so. High priced equipment constitute just the tip of the pyramid. The OEMs have to make a choice to be either a niche player or be really price competitive to play the big volume game. Within that price band technology, quality and after sales support will be a differentiator. What challenges do you face in terms of equipment finance, infrastructure and getting skilled manpower? Availability of equipment finance varies from product to product. The high delinquency in the industry made NBFCs cautious. The funding as a percentage of asset value, though customer specific, got reduced across the board to secure repayment. To that
extent, financing is a bit of a concern particularly for the FTBs and FTUs. As the industry started picking up, financing started easing out. Demonetisation will not only make financing cheaper but also easier to come by. This is going to help the demand grow. What are your expectations from the government for the sector? The industry is looking for continued focus on infrastructure sector by the central government. Nitin Gadkari is doing a great job. Projects need to be started as per plan and the current ones completed on or before time. Of course, the game changing tax reform GST needs to see the light of day next year. We are keeping our fingers crossed.ď Ž
December 2016 | CONSTRUCTION TIMES | 37
BAUMA CONEXPO India
Interview
Companies are now focusing on making green equipment Pankaj Kumar, VP, DOZCO India says the trend is towards manufacturing equipment that eimt reduced smoke and consume less fuel. What kind of equipment does your company manufacture? DOZCO, a name to reckon with as a dependable source for machinery and spares in the field of construction and mining industry since 1983, being rich in experience and knowledge, spiriting by undaunted entrepreneurship, aided by technical expertise of team of dedicated professionals took the determined step forward by establishing the state-of-the art manufacturing plant at Visakhapatnam, India in 2013 and emerged as manufacturer of quality attachments, undercarriage and components for construction & mining equipment. Product from the Plant includes: • Rock Breaker in wide range • Tool/Chisel applications
for
• Hydraulic Quick versatile design
varieties
of
DOZCO provides quality products and service at an affordable cost, with a single minded objective of maintaining a well satisfied client base by fulfilling their needs, increasing their long term profitability, reducing their overheads and optimizing their investments.
How does the mechanism of the machine work to ease the work? Advance series of DOZCO Rock Breaker are comes with superior technology. There is “No rigid side bolts” which ensures low maintenance & operating cost. Advanced dampening system is improved to minimize shocks, noise level and vibration. High Pressure Accumulator is modified to eliminate pressure fluctuation & increases Impact Power. We can adjust the Stroke length and Blow per minute for different application/material by the help of Valve Adjuster & Cylinder Adjuster feature. More Protection to front cover - High tensile wear resistance plate (Bottom Plate). Constructed outer & Inner Ribs on the Rock Breaker Body - It reduces the internal torsion stress and increase breaker lifetime. What are the elements of this machine
DOZCO Advanced Series Rock Breaker Ranges: Coupler
in
• Bucket to meet OEM Standards • Undercarriage equipment
DOZCO products are useful in mining and infrastructure / construction sector. Rock breaker is the attachment which is used to break the rocks. Chisels are the most consumable item by Rock Breaker during breaking and demolition period. Hydraulic Quick Coupler is mounted on excavator to save time by quick change of attachments such as Bucket, Rock Bucket, Cutter, Shear, Rock Breaker etc. When you workday doesn’t end, or your event heats up after the sun goes down, then you need to put the power of DOZCO light source to work for you. Undercarriage is the most running Item of Crawler Machineries.
for
crawler
• Ground Engaging Tools • Portable Tower Lights etc. In which sector of construction is it useful?
8 models of Rock Breaker available for 2 – 60 Ton class Excavators. Models
Weight (Kg)
Tool Dia. (mm)
200A
126
45
700 - 1200
430A
458
75
400 – 800
6–9
450A
660
85
400 – 800
7 – 14
800A
933
100
350 – 700
11 – 16
2000A
1725
135
350 – 500
18 – 26
2200A
1928
140
350 – 500
20 – 26
3200A
2508
155
300 – 450
8 – 38
5000A
4200
175
200 – 350
40 – 60
38 | CONSTRUCTION TIMES | December 2016
Impact Rate Carrier Class (bpm) (Ton) 1.2 – 3
in terms of its size, weight, portability and fuel used? These Breakers are superior in quality at low price. We offer for both primary & secondary application. We manufacture Moil Point, Conical, Wedge & Blunt type chisels for all Rock Breaker Manufacturer. DOZCO chisels are superior in quality. DOZCO manufactures undercarriage ranging from 140 mm pitch to 216 mm pitch. Undercarriage Parts like, track link assemblies with Track Guard, Rollers, Sprockets, Idlers, for all kind of Excavators, Dozers, Apron Feeder and Drill Machine etc. In today’s world, how important is it to have eco-friendly equipment in the industry? These days, the Heavy Construction Machineries come with electronic engines which lead to high horsepower. Electronically operated high horsepower ensures lesser amount of smoke emission into the environment. Since, the modern equipment have fully automatic systems, the fuel consumption is reduced considerably. This again leads to less smoke emission and pollution. As against the earlier machines which demanded a lot of maintenance due to frequent breakdowns, the present day equipment is very technologically advanced. Due to this, there are less breakdowns, thus, resulting in less requirement for replacement of parts. Environment-friendly equipment are not only beneficial for the ecosystem, but also for the construction companies as it can reduce the overall cost of maintenance of the equipment. Realizing this trend, CE manufacturing companies are now focusing on making green equipment that emit less amount of smoke and give more energy with less fuel consumption. So, the time has
come to go green! How is the present market scenario of the construction equipment industry? The Construction equipment industry has already started booming up in India, with an objective to bring quality infrastructure, the government has taken several initiatives like Smart Cities, Make in India, Swachh Bharat, National Highway Projects and rural road flagship schemes. All these collectively bring a positive outlook to infrastructure industry in general and construction equipment industry in particular. What is the potential of this industry in our country? The potential of this industries in India looks very good in near future. In fact the demand for construction equipment is already being observed due to development of road infrastructure, growth in the real estate sector, development of ports, pipelines, airports, power and other infrastructure projects, mining, building and material handling. We sincerely believe that the overall earthmoving industry in India will grow by at least 30-35 per cent over the next five years. What is is impact of GST in manufacturing segment? The manufacturing sector has been a major economic driver for many
developing economies across the world,. Now manufacturing may be revived with the focused efforts of the new government. India, traditionally an agrarian economy, could even experience a paradigm shift from an agricultural economy to a manufacturing and service based economy. The government also realises that becoming a manufacturing hub will need several strategic reforms to simplify manufacturing in India. One of the proposed reforms, in line with Make in India, is the implementation of the Goods and Services Tax (GST). The new GST regime will trigger a transformational shift from a complex multi- layered indirect taxation system to a unified indirect taxation system. GST will also propagate a positive change by ensuring cascading of taxes is reduced, thus leading to manufacturing synergy in India. The new GST regime will be a modern tax reform which will usher in growth and opportunities for businesses in India. It will have a far-reaching impact on business avenues, compelling organisations to realign bottlenecks such as production cost, production time, supply chain, compliance, logistics, etc. with the changing indirect tax structure. Furthermore, all major business dynamics will have to be thoroughly analysed to assess the impact of GST on business. ď Ž
December 2016 | CONSTRUCTION TIMES | 39
BAUMA CONEXPO India
Insight
New heights Everest Engineering has been able to achieve higher levels of growth over the past two years. P V RAMDEV, MD, Everest Engineering Equipment speaks about the highspeed passenger hoists for 200M – 600m heights to suit customers’ special and specific requirements.
E
VEREST ENGINEERING has extensive technical expertise in operations and maintenance of tower cranes which are offering conversion support services for tower cranes. This is relatively a new support area in India. The company exclusively distributes FineHope , SYM flattop and electric luffing cranes which are equipped with electronic safety system, speed control, etc. Fine Hope tower cranes are available in 32-200 tons, whereas SYM luffing tower cranes in 8-32 tons. The conversion comprises converting of existing tower cranes from being electrically driven, (with power sourced from captive diesel generating sets at the site) to Variable Frequency Support (VFS) driven. With VFD, the consumption of electricity comes down by 35 per cent. For a 6-8t tower crane, it will be from a 125KVA DG set to 62.5 kva, that will save at least 3 litres of diesel per hour. If we calculate 20Hours working per day for 26 days a month, it will save 1560 Litres of Diesel which will be 18,720 Litres an Year. The cost of this diesel @`50 will be amounting to `9,36,000 per year and this amount is get burned by most of the construction companies with out their notice. The cost of conversion is close to Rs five lakhs, while it delivers saving of 9-10 lakhs on an average on diesel consumption.” every year. Everest has executed 30 projects for converting the tower cranes to VFS driven. Prominent conversion projects executed by Everest Engineering are converting of tower
cranes for JMC projects working in varied real estate projects in Mumbai, Delhi, Chennai, and Bengaluru. The cranes converted to VFS driven were of various make.
mechanism. Since it handles people to vertical heights it is very important that a VFD control achieves a very smooth start/stop operation as well as saving of power up to 35 per cent.
Benefit for easy and quick identification of faults PLC controls are good to find faults whereas the VFD (Variable Frequency Drive) is mainly for accurate operation without any failure. PLC input/ output indictors are an additional used for smooth start and stop functions as well as saving of about 35 per cent power consumption.
The company’s product support network offers the following services:
The Passenger Hoist is concerned the best control technology is the VFD
40 | CONSTRUCTION TIMES | December 2016
• Erection, dismantling, O&M and spare parts for Luffing/flat top/top kit tower cranes and passenger hoists. • Technical consultancy for proper selection of tower cranes and passenger hoist according to particular site conditions like scaffolding system, jumping sequence and capacity. • Provides location drawing, execution charts, method statement and risk analysis. • Training and maintenance • Anti-collision devices and SLI (Safe Load Indicator) for tower cranes which are used for protecting tower cranes and other building/HV lines/towers/ machineries at site by avoiding collision. Also along with the standard solutions to fit customer requirement, Everest experts can offer customer solutions like Tower Cranes for 200m and above heights. Passenger Hoists to fit inside the lift shaft, High Speed Passenger Hoists for 200M – 600m heights to suit the customers’ special and specific requirement. n
Half century for GENIE
G
ENIE, a Terex brand which completed its 50 years of pioneering and being the world’s largest manufacturer of Aerial Access Platforms and has been represented in India by MACO Corporation India Pvt. Ltd. since 2002. GENIE was one of the first products to be offered to the market with complete sales and after sales support and that set the pace for many other products in the MACO offering to the Indian market. GENIE equipment save lives at work places, it keeps people safe without compromising on work execution speed. The GENIE brand of Mobile Elevated Work Platforms (MEWPs) is the preferred choice by any reputed company across the world for work place safety while working at height. It continuous evolution principle has made it the inventor of the highest boom lift in the market the SX-180 which stands tall with a working height of 56.69 m the highest for a self propelled telescopic
boom lift. The quality of the GENIE machine is acknowledged by the simple fact that companies like Nestle, ITC, TATA, Shell, Maruti Suzuki patronise the brand again and again for every access requirement at their facilities. The sturdy build and the easy maintainability of the GENIE machines make it the preferred choice for rental companies as well. We have witness the change over my many rental companies from the other brands to GENIE over the last couple of years. It was a difficult path to tread but the success Is now showing to the owners of these companies who understood what it really means to have the “highest valued lifting equipment” in the market. MACO also has plans to soon come up with a refurbishment centre whereby pre-owned GENIE machines can be given an extended life and at the same time the quality of existing machines in
the market can be improved and safety ensured at every step. MACO has been successful in placing the GENIE brand of machines in every industry and companies like TATA Power, Power Grid Corporation of India, TATA Steel, ABB, Alstom, GE, Nestle, ITC, TATA Power, TATA Chemicals, Indian Navy, ISRO, DRDO, Larsen & Toubro, Shell , Oberoi Hotels, Hyatt, Marriott to name a few. MACO headquartered in Kolkata, has a PAN India presence with a strong network of sales & service network. Traditionally a trading company, MACO evolved into a dedicated sales and service provider for many of the world’s premium & high end engineering goods and solutions. n
ARK& Events & Media Pvt. Ltd. ARK Events Media Pvt. Ltd. S-02, Haware Fantasia Business Second Floor, S-02, Haware Fantasia Business Park, Park, Second Floor, Near Mall, InorbitSector Mall, Sector Near Inorbit 30-A, 30-A, Vashi,Vashi, Navi Mumbai - 400Tel: 703, Tel:650 02267220/22/23/24 650 67220/22/23/24 Navi Mumbai - 400 703, 022 June 2016 June 2016 39 CONSTRUCTION TIMES 39 CONSTRUCTION TIMES
December 2016 | CONSTRUCTION TIMES | 41
BAUMA CONEXPO INDIA
Equipment
Putzmeister – German Concrete Pumping Technology at its Best P
utzmeister’s incredible journey of nearly 60 years is marked by major milestones in research and development, as well as in partnering landmark projects globally, making them one of the top leaders in concrete pumping technology worldwide. In partnership with its parent company in Aichtal, Putzmeister Concrete Machinery, based out of Verna, Goa, has been actively commissioning cuttingedge research and development for concrete equipment since 2007 in India as well. To provide customers with the very best, Putzmeister closely monitors the Indian market and its demand and more than that, the need and requirements of their valued customers. Make in India Based out their factory in Goa, Putzmeister has been churning out top notch quality concrete equipment that have been specially innovated and designed for the rough conditions prevailing in India. “Infrastructure projects led by roads, metros, bridges and power stations
Putzmeister BSF 36-4, truck mounted boom pump with Z-Fold and one sided support system are currently driving the demand for concrete systems and we expect this to continue. Rapid development in Tier II cities is also a major source of demand and a current driver,” says Wilfried A Theissen, MD, Putzmeister India. The Indian concrete pump market is distinct from mature markets. “In mature markets like the USA, Europe and even China, truck mounted pumps are the main product lines,” observes Theissen. “In India, however, stationary pumps with an hourly output of 40-90 m3 dominate the market.” Automation in Putzmeister stationary and truck mounted boom pumps, allows operators to monitor the fuel consumption, hydraulic oil heat control, pressure, output, engine performance, etc. “The ability to synchronise the engine output with the required pumping output introduces operational efficiencies, a growing
MT-1.0, the 60m3/h power package 42 | CONSTRUCTION TIMES | December 2016
consumer priority,” says Theissen. Compared to other concrete pumps, the BSA eSmart range and the new generation truck-mounted concrete pumps from 2Putzmeister featuring Open Pumping System technology can save up to 50 per cent oil without compromising on output. The truckmounted concrete pumps are also equipped with electronic safety sensors and one side support for better manoeuvrability in confined spaces. Putzmeister Launches the Ultimate Batching Plant The first Batching plant, MT 1.0 with an output capacity of 60 m3/hr was launched in Aug. 2015, followed by the MT 0.5., with an output capacity of 30 m3/hr, designed for the Indian market. Putzmeister’s MT-1.0, the 60m3/h power package Quality From Start To End The MT 1.0 can literally be seen as the ultimate batching plant that offers the best of operations and maintenance through its unique features. With the mission to meet customer needs and the backing of decades of experience, this plant has been indigenously developed
by the local R&D team for exceeding requirements of all stakeholders in the concrete world. This batching plant has been designed and manufactured keeping in mind Indian requirements i.e. safety, tough operating conditions, low maintenance costs, high output. Performance That Pays Off The end objective of any batching plant is to produce consistent homogenous mix of concrete, which is well managed by the twin shaft mixer in the MT 1.0 with shorter mixing cycles, resulting in time saved and increased output. With a robust design, it ensures that the customer’s project can run at its full capacity from day one. The MT 1.0 encompasses technology at every stage. With an independent weighing system and an automatic calibration system, the plant ensures accurate weighing of mix components and accurate calibration. This allows lower manual intervention and high productivity at all times. Remote sensors monitor the inputs at every stage, while the machine is fed through on-site silos or conveyors. Complete automation ensures a steady production of 55-60 cu. m/hr in real time. Maintenance Made Easy Maintenance is easy, with built-in features like automatic lubrication system, requiring minimal manual intervention and periodic supervision. Greasing to all essential components safeguards the machine from operational issues, providing hassle-free automated maintenance to the heart of the plant. Structured For Benefits Putzmeister batching plant has been designed to make mobility and maintenance easy. With a wide frame structure, the MT 1.0 offers easy drivethrough for trucks, in the sense that the truck mixers need not drive in reverse mode, which guarantees faster
Easy drive through: reduced turnaround time turnaround time and higher efficiency. built-up space of 1,000,000 sq. ft. of The easy and safe access to the tower high-end commercial, retail and service is another unique selling point – apartment space. Many more prestigious The Putzmeister Batching Plant also projects across India stand as a proof of contains three solid maintenance stairs the stakeholders’ unwavering faith in and platforms, providing ample space the efficacy of Putzmeister’s concreting for maintenance activities, considerably technology in getting the job done. improving important safety features. Closer To Your Business Access At Fingertips Putzmeister is not only a world class Fitted with cutting-edge batching concrete equipment manufacturer but software, the MT 1.0 ensures high degree also takes pride in providing quality of automation through its user friendly service. Keeping true to their motto a interface that allows comprehensive comprehensive and systematic approach process visualisation and control over to maintenance, supported by country batching functions at your fingertips. wide sales and service network and regional and local offices all over Latest Major Land Marks In India India stands in support to its clients. Putzmeister’s 24X7 emergency service -Reliance in Jamnagar, Gujarat and original spares are a great value-formoney proposition. Qualified engineers Putzmeister has been a steady partner from Putzmeister advise fleet managers in building one of the world’s largest oil at regular intervals on occupational refineries which produces 1.24 million safety. Special courses are also conducted barrels of oil per day. to train operators and service staff for efficient operation of all the machines. Bengaluru’s 5th largest building and the biggest luxury commercial property Putzmeister continues to listen closely project to the local market dynamics to launch new products or solutions into the Indian Using BSA 1408 HD, M30 grade of market, responding to the latest market concrete has been pumped to a height requirements with machinery that exceeds of 130 m, giving rise to the target quality and performance standards, whilst height of this esteemed project of 145 being user and environment friendly and m, built on a total area of 13 acres, a economical. n December 2016 | CONSTRUCTION TIMES | 43
BAUMA CONEXPO INDIA
Product Profile
Hydraulic Tipping Solution For Vehicles H
yva, a global provider of transport solutions for the commercial vehicle and environmental service industries, is launching ALPHA Series, a new range of tipping solutions, for the construction, transportation and mining sectors, which deliver higher transport efficiency and safer operation at lower cost. These next generation front end tipping solutions will be available to customers during the last quarter of 2015 and prior to their launch they will be showcased at several exhibitions around the globe.
Extensive field testing in India and China of a variant of the ALPHA Series has validated the benefits of the new solution and attracted praise from customers. Maximum benefits in terms of efficiency and reduced operating costs will be achieved with installation of the complete hydraulic system.
“The ALPHA Series will extend and consolidate Hyva’s record of innovation and leadership in front end hydraulic cylinders. This is the fifth generation of front end tipping solutions which Hyva has brought to market,” explained Jacob Biemond, R&D Director. We are proud that we are maintaining our position of offering the lightest, fastest, most efficient and safest tipping solutions to our customers.”
tipping valves, new tank and filter options, and, pumps operating at higher pressure. These improvements deliver faster tipping, shorter cycle times and reduced system size and weight which can translate into more efficient working routines, increased payloads and reduced operating costs. Smaller space installations, quick connections of valves, cylinders and hoses, maintenance free seals and longer service intervals all contribute to lower levels of downtime. Safety is enhanced through re-designed cylinder overlaps and guide systems and new cylinder mounted HT tipping valves with new pressure relief safety. These features reduce the risks of vehicle turnovers and hose bursts. The operator has complete control over the tipping system.
Transport Efficiency, Safety and Reliability In this new tipping solution, hydraulic cylinders are smaller, lighter, stronger, operate at higher pressure and consume less oil. Brackets are stronger, lighter and can be maintenance free. Wet kits have improved knock-off and control options, cylinder mounted
Reliability has been improved through a programme of review of every single component. Wherever necessary, components have been redesigned and then tested to satisfy the required lifetime of that component. Environmental performance too is improved through lower fuel and oil consumption.
Hyva’s unrivalled customer service and after-sales support comes as standard too. For truck manufacturers, body builders and end users who are all keen to find the right solution for their specific tipping requirements, ALPHA Series from Hyva delivers a market driven solution for every tipping application. n
Performance improvement has been achieved through re-design and reengineering of the complete hydraulic system, down to the component and sub- assembly level, together with improvements to installation and service procedures.
44 | CONSTRUCTION TIMES | December 2016
Tipping Solutions Customised to Market Segments Construction, C-Line: All-rounder and Heavy duty Rigids for both Onroad and Off-road applications Transportation, T-Line: Allrounder, Heavy duty and Silo Trailers Mining, M-Line: Heavy duty Rigids
BAUMA CONEXPO INDIA
Product Profile
Sustained Robust Growth In Current Year M
tandt Group have seen sustained robust growth in current year and added new innovative products to its portfolio Chennai. The Mtandt Group endured its qualitative growth path in current year 2016, despite of weakness & volatility in exchange rates, markets and an uncertain global economy. Mtandt has come up with strong results and expects to close this financial year with annual increase in turnover by 60% over last financial year 2015-16. In first two quarters of the current year the group has poised the increase in revenue by 35% as compared to previous year. Looking current order status; group is quite confident of achieving the targeted revenue growth of 60%. “Since 1974, we have written an impressive, sustained success story. The Mtandt Group signifies real value and reliability in a world full of uncertainties”, said. Rakesh Modi, Managing Director, Mtandt Group. He added, the Group aims to grow further next year as well: “We want to get better in every aspect in 2017 and strive for taking the group to next level.” Pradeep Agarwal, Associate Director, Mtandt Group, said: “Our goal for fiscal year 2016-17 is to achieve further growth both in terms of volumes and in the Group’s sales revenue and operating profit” “Mtandt Group have plans to invest Rs 7bn (100mi USD) over a period of two years in various verticals including enhancement of rental inventory, its servicing and refurbishing facility” announced Modi. This year Mtandt Group have tied up with various OEM’s to promote their innovative products in India and neighboring markets like Srilanka, Nepal, Bhutan
and Bangladesh. XCMG: Mtandt will be distributing XCMG’s Hydraulic Fire Trucks upto 102 meters reach height. Construction Machineries like Piling Rigs, Motor Graders, Wheeled Loaders and All Terrain Cranes are also sold and serviced by Mtandt Mtandt joins hand with the world renowned aerial work platform manufacturer RUTHMANN for their truck mounted aerial work platform business. Through this partnership, Mtandt will have exclusive sales and service rights for entire product range of RUTHMANNSTEIGER in the territory of India. Aardwolf Monzon: , Mtandt Group, for last four decades, specialise in developing, manufacturing and supply of Innovative Scaffolding solutions under iconic brand Aardwolf Quickfit, brings first time in India “No Limit – The Unlimited Scaffolding Solutions”. Its unique ability to get fit into infinite combinations makes it most effective, convenient and time saving to install than conventional
46 | CONSTRUCTION TIMES | December 2016
solutions. Porta Deck - Engineered and manufactured by Mtandt Group, Portadeck is the trusted choice for many industries – construction, drilling, mining, shoring, utility/ transmission, site remediation and heavy-haul. The same features prized by these industries make Portadeck mats ideal for military applications and they can be used to create access roadways, helicopter landing pads, maintenance areas, motor pools, warehouse or hangar floors, encampments, and even mobile medical facilities. Portadeck is the strongest modular matting system Mtandt Group manufactures. Its unique composition of HDPE, UV protection, anti-static and other additives makes it non-absorbent, prevents degradation, and eliminates warping and breaking due to climate. Mtandt have introduced innovative construction machineries like Rack & Pinion Passenger & Material Hoists from hand-picked manufacturers around the world into the Indian market. n
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BAUMA CONEXPO India
Lift-off
Construction Equipment
After three years of sluggish growth due to an economic slump, the CE industry is on a growth path again.
C
onstruction Equipment (CE) are the backbone for any project. They are most required if you need to ensure safety, complete the project on time and make your project technically strong. The construction equipment market over the years has been witnessing both ups and downs in terms of demand. Today, it is not unknown that the CE market is seeing a year-on-year growth, thanks to the emphasis of the government to clear stuck projects as well as introduce new projects to get development going. These new projects have attracted interest from construction companies for new and preowned equipment to fulfill the norms while applying for project tenders. While the new market is already witnessing good sales numbers, we tell you how the preowned CE market is benefiting and in turn, how buyers too are reaping maximum benefits by buying used equipment. As per data from SIAM (Society of India Automobile Industry) the ratio between new and used CE is 1:1 which means
every time new equipment is sold, preowned CE is also sold. It sometimes becomes difficult to identify the players who offer the best range of used CE to choose from. Whether to search online or visit your nearest dealer is still a topic of debate as some prefer online while others prefer to go to a dealer, see the equipment and then make a purchase decision. Finding Out The Most Trusted Player For Buying Used Equipment There are a number of players who claim to offer the best line up of used construction equipment in India. What makes Shriram Automall different is it comes from one of India’s most Trusted Group - Shriram Group. The company, within a span of just five years, has become India’s leading service provider for the exchange of preowned vehicles and CE. The CE business with Shriram Automall is seeing a y-o-y increase with excavators, loaders and
48 | CONSTRUCTION TIMES | December 2016
backhoes being the most in demand. Most construction business owners now prefer to search for used CE instead of going for a new one as it has a major difference in price. Built on the bedrock of trust and transparency, the pre-owned CE segment of Shriram Automall is riding on a positive growth track. CE does not only make it easier to complete projects but also ensures the efficient use of labour, time and money. Shriram Automall caters to every need with a wide variety, including hydraulic excavators, wheel loaders, loader backhoes, cranes, motor graders, crawler tractors, piling rigs, forklifts, off-highway trucks and other mining machinery. The company has now started its voyage towards capturing the interests of international buyers. Shriram Automall, after the new Union Budget for 2016, aims to capture a large share in the market as the government has allotted huge amount towards construction of new highways and road networks all over the country. With this big push provided by
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BAUMA CONEXPO India the government the construction business owners are also positive about buying both new and used equipment to make their bid for acquiring new tenders. Other government initiatives including the Make in India campaign is also providing the required boost. For its customers, the company offers various platforms for buying and selling used CE. However, a private treaty is the most preferred platform for closing deals. With a personalised approach and negotiated deals, every need is fulfilled with customised solutions through private treaties. Over the years, Shriram Automall has acquired a significant amount of share in the organised market for trading of used CE and has facilitated transactions worth Rs 1000 crore. The company has become a one-stop solution for people who want to buy used equipment in the most organised and transparent manner. The Market Point Of View After three years of sluggish growth due to an economic slump, the CE industry is on a growth path again. Coming out of three years of de-growth, the industry is stabilising this year and is gathering momentum for the next few years, thanks to reforms and policy measures in the infrastructure sector. Initiatives of the new (central) government have made the macro parameters favourable to the industry. With the economy reviving and inflation under control, some reforms such as opening up the insurance and defense sectors for more FDI (foreign direct investment) will lead to more infrastructure projects requiring equipment in India. An investment of $1 trillion has been projected for the infrastructure sector until 2017 around 40 per cent of which is to be funded by the private sector and the rest 60 per cent from government-funded projects. Around 45 per cent of infrastructure investment will
Construction Equipment be funneled into construction activities. These huge investments in the segment will be the main drivers of growth for the industry. The recent union budget was also majorly focused towards reviving the infrastructure of the country and has allotted a huge budget for construction of new roads and highways. India has globally become one of the key potential markets for construction equipment. Construction market contributed nearly 7 per cent to India’s GDP and is further estimated to increase to 8 per cent. Further, by 2025, India’s construction market is expected to emerge as the third largest in the world, which would exhibit huge demand for construction equipment in the coming years. With the new CE market now on track, Shriram Automall expects to increase its sales since even during the sluggish period, demand for used equipment remained rock solid. Now with these new measures, the company is hopeful for many good years ahead in terms of demand for used CE. Why Visit Shriram Automall For Buying Used Construction Equipment Whether it is purchasing used equipment or maybe used trucks, owning a vehicle is not a tough task now. Today, when people are slowly and gradually shifting towards better lifestyles, their mindset and ideologies are also changing. Today, people know that purchasing a used vehicle won’t damage their pride and prestige. Besides a wide range of vehicles and equipment, the company also serves various platforms for easy acquisition and disposal of vehicles and equipment. The physical bidding platform is the most popular platform considered on the grounds of transparency and fair deals. But being an easy and instant platform in terms of market reach, online bidding has now gained much required momentum
50 | CONSTRUCTION TIMES | December 2016
over time. The company also has its private treaty platform, where the company serves as a negotiator between the owners of bulk or single assets at a high value and potential customers. Another of Shriram Automall’s unique platform that provides real-time information about pre-owned vehicles for disposal is Shriram OneStop Classified KIOSK. This platform helps individual and fleet operators to interact and strike deals. The kiosk is an interactive machine from where it is easier for users to view and select the vehicle of their choice. These platforms have been presented with high strategic compliance and have proved to be successful among their own niche audiences. From helping the buyers in inspecting the vehicle onsite to enabling the customer to connect with the company from anywhere easily, Shriram Automall has every possible thing a customer would need to have their trust built in a company. Shriram Automall is the only company working towards organising the highly unorganised market dedicated towards exchange of used vehicles and equipment for over five years. Thus, the company has brought forward an innovative approach for the acquisition and disposal of pre-owned vehicles and construction equipment through its unique bidding platforms, especially physical and online bidding along with the private treaty and OneStop Kiosk. Its unique bidding platforms has helped all; OEMs and individuals alike. SAMIL’s professional services has touched the lives of many. Transparent, Efficient, Safe and Reliable That’s how customers regard the bidding process at Shriram Automall. The company has improved the purchase capacity of people in the zone by providing them with a wide range of used vehicles and construction equipment at a fair price through its unique physical bidding platform, combined with easy finance options.
focus
metro
Mumbai Metro:
A Smoother Ride For Commuters Mumbai’s upcoming metro line III has imbibed the lessons of the past.
I
t took a long time coming. But Mumbai’s metro line I, when completed, carried with it, time and cost overruns it could well have done without. The cynosure of all eyes back in the day when it was first conceived, the project ran into trouble from the start, resulting in a courtroom battle that continues to this day between its public and private partners, namely, the Reliance Infrastructure-run Mumbai Metro One Private Limited (MMOPL) and the Mumbai Metropolitan Region Development Authority (MMRDA). That’s not to say the city’s first metro line hasn’t proved to be a boon for more than 15 crore people who have used it since it commenced operations. On the contrary, RInfra says ridership has risen almost 18% over the last year to the current average of 3.5 lakh on weekdays. So, what went wrong? In a nutshell, “everything that could have gone wrong, did,” recalls Sumit Banerjee, who was heading Reliance’s infrastructure business at the time the metro line was being constructed. As history beckoned, India’s first ever metro project under the public private partnership (PPP) model fell over its own feet in eagerness to get things started. An overly enthusiastic but impractical offer by MMRDA for clearing all Right of Way (RoW) issues
in approximately six months along the proposed 11.40 km route through densely populated urban settlements was inexplicably but equally enthusiastically accepted by RInfra. The land meant for the depot, too, ran into problems. The cost of the project escalated from an initial estimate of Rs 2,356 crore in 2007 to Rs 4,026 crore by the time the project was completed. Moreover, RInfra says with respect to viability gap funding, it received only Rs 567 crore from MMRDA as against Rs 650 crore that was agreed. MMOPL is now asking for a hike in fares which MMRDA has challenged in the Bombay High Court. “The fellows who committed such things, to give us RoW and to get the underground utilities removed in six months all along the route...they didn’t have a clue how this was to be done,” rues Banerjee wistfully. In fact, towards the Ghatkopar end, it beggars belief that RoW for a small stretch was given as late as just four months before the commissioning of the line! There were other problems that contributed to the delay but Banerjee attributes about 80% of this time and cost overrun to the problems over RoW. After one round of financing that has extended MMOPL’s repayment schedule to 2037 and the maturity of the loan to 22 years, a spokesperson told Fe that the
52 | CONSTRUCTION TIMES | December 2016
company is exploring various options to further reduce the interest burden and cut operational losses. An expensive education, but wiser for the experience, the eight metro projects currently under construction in Mumbai all reflect the learning of that early lesson. First, the government seems to have abandoned the PPP model for subsequent metro projects which are all being tendered under the engineering, procurement and construction (EPC) mode. Second, there is an emphasis on clearing all RoW issues prior to the tender process. “We have got all our land requirements in place as well as the RoW permissions. The civil engineering tenders have been awarded. The work has already begun,” says Ashwini Bhide, MD, MMRC, referring to Mumbai’s metro line 3, which is expected to be ready by 2020, albeit in phases. However, the land required for the depot is a potential roadblock with environmentalists agitating for shifting the site. But Bhide is adamant. “Shifting the car depot is ruled out. There are not only cost implications but the land to which they are proposing to shift is beset with legal hurdles. We can’t wait anymore and we need to have the depot land in our possession. The work for this also needs to start as soon as possible,” she
says. Nonetheless, MMRC could revise downward the area of land they require for the depot as they plan for only 35 trains up to 2040. “Ridership will increase only gradually so another 15 trains can be added much later. By 2040, more options will be available for land for the car depot when there is an increased requirement for more trains,” says Bhide. With the usual hurdles already accounted for, it is now up to the engineers working on the project to deliver on time. The Indian arm of the French engineering group Egis is one of four consultants for this line and Ashish Tandon, MD, Egis India says the challenge is not in getting approvals and permissions for shifting utilities and resettling people, but a technological one. No wonder the tendering process was weighted 90 per cent towards quality and just 10 per cent on price. “This will be the first fully underground, driver-less system, constructed beneath various monuments and sensitive structures in the challenging soil conditions of Mumbai,” says Tandon. He warns that South Mumbai dwellers could face some discomfort owing to the lack of space in the area for creating work sites close to the actual construction of the underground stations. So far, though, the metro line III is on schedule. Simultaneously, a number of other metro lines envisaged earlier have also taken off and are in the initial stages of approval, planning and/or construction. Barring line III, the others will all be elevated lines.
For Metro-2A and Metro-VII, Prime Minister Narendra Modi had laid the foundation stones last October. Now, the civil contracts for corridor 2A (Dahisar-W to DN Nagar) have been recently awarded and work is expected to begin shortly for this 18.5 km stretch. For the remaining part of the same line, being called 2B and which runs from DN Nagar to Mandale, the project is awaiting cabinet approval. This second stretch runs for 23.6 km and together with the first stretch, has a total length of 42 km. The other project awaiting cabinet approval is the 32.3 km metro line IV from Wadala to Kasarvadavali. The only other metro line under implementation is the 16.5 km line VII (Andheri E to Dahisar E) on which certain stretches have been barricaded, an indication that construction is likely to begin sooner rather than later. This project is estimated to cost Rs 6,208 crore. With so much happening, working hours have been devised in shifts by civic authorities to minimise disruptions to daily commute schedules. Additional traffic lanes are being provided as well as
more traffic wardens to regulate traffic. The Western Railway is reportedly considering requests to run more services while the city’s bus service has agreed to provide more air-conditioned buses during the construction of the metro VII corridor. In short, the city is readying itself for a hectic phase of construction activity for the next few years along the various metro routes. Funded jointly by the central and state governments along with soft loans from multilateral funding agencies such as the World Bank, Asian Development Bank and Japan International Cooperation Agency (JICA), Mumbai’s spanking new metro lines, when they come up, will boast the latest in technology and efficient service. However, as is evident in a comparison between the existing line and the ones under construction, they are all as different from the other as chalk is from cheese. One can be sure, however, in the very near future, all of these new metro lines will provide an undifferentiated and seamless connectivity throughout Mumbai.
December 2016 | CONSTRUCTION TIMES | 53
o
Real Estate
Investment
How Attractive is Housing as an Investment? Affordability decisively drives demand, but cheap, featureless flats in far-flung emerging locations are finding no takers.
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s we can read in most news stories about the Indian residential property sector, housing has become increasingly end-user driven over the last two-three years. This effectively means that it is mostly people who actually intend to use homes for selfoccupation who are buying them today. In other words, the pride and security vested in home ownership has not waned one bit in India. However, as an investment class, housing has certainly taken a nosedive until recent developments transpired to revive sentiment. The Return Of The Property Investor One factor that helped on this front was the series of property price decreases which were witnessed in almost all tier 1 cities of India. These corrections were driven by market realities - housing in cities like Mumbai, Delhi, Bangalore, Hyderabad and even to some extent
in Pune was simply not selling at the quoted prices, and developers had no choice but moderate their price tags. Sensing the market bottom, residential property investors once again began making calculated plays in the sector. In India, investor demand is driven squarely by end-user demand. In other words, investors will only pick up residential properties if they perceive that there are actual buying and renting end-users on the market. This is in sharp contrast to speculator demand, which is usually not driven by market realities at all but purely by vaguely formulated opinions of a future demand scenario. Needless to say, Indian property speculators had burnt their fingers severely in the last four-five years and have entirely vanished as a breed. Not surprisingly, the segment of residential real estate that has seen the most decisive return of investor interest
54 | CONSTRUCTION TIMES | December 2016
is affordable housing - which has indeed become as affordable as it can get in most Indian cities. It is not only price cuts which have boosted affordability in cities where even price moderations have proved insufficient to incite demand, many developers are offering genuinely value-adding schemes and incentives which have made purchase decisions a lot more attractive to endusers. And unlike in previous years, these offers will continue well past the festive season this year. What Kind of Homes Make The Most Investment Sense? To identify the best residential investment opportunities today, one must understand two things - one, where the bulk of the existing end -user demand is coming from and two, what kind of homes this demand is for. Affordability decisively drives demand, but cheap, featureless flats in
far-flung emerging locations are finding no takers. This fact was first evinced in Delhi NCR, where entire districts have turned into veritable ghost towns because of their lack of infrastructure. In other cases and in many cities, we are seeing even completed buildings standing empty because of faulty land titles, lack of water and electricity supply and absence of decent connectivity to workplace hubs. The inherent value of location, developer’s brand and availability of decent amenities has come to the forefront of most purchase decisions today. The most active buyer segment today is that comprised of young working couples and professional individuals who are looking for welllocated smaller homes in projects which they can afford, and which offer them a good lifestyle. For this reason, ‘bare shell’ flats are rapidly becoming the least favored category, as such
buyers have neither the interest or bandwidth for starting from scratch on a new home. Fully-furnished flats with all the trimmings in projects which have advanced lifestyle features are now in vogue. Such offerings are in immediate
demand both as purchase and rental options, making them the immediate focus area for today’s residential property investors. Simultaneously, buyers are giving equal weightage to location, reputation of the developer and the affordability of the quoted price. Hidden costs are out, allinclusive rates which leave nothing to the imagination are in. Inferior project in non-performing locations are out, regardless of how attractive the price tags are, and well-connected suburban locations are in. End-users looking at first-home purchases are obvious focusing on the cities they currently reside in or are relocating to for work. Investors, however, have a much wider playing field. The highest investor inquiries are currently emanating from cities like Navi Mumbai, Chennai, Bangalore and Pune. All these cities have a very good saturation of demand drivers, and are generating the highest number of employment opportunities. Yogesh Mehra is Co- founder & CEO - YOLO Homes, and has over 20 years of real estate industry experience. He has traveled the world to study contemporary residential living formats, and has worked with numerous leading brands. As CEO, he spearheads the YOLO Life franchise of 100 per cent managed and facilitated convenience homes in India.
December 2016 | CONSTRUCTION TIMES | 55
Real Estate
RERA
Wait For The Real Estate Regulator Bill (RERA) Or Buy Now?
The days of unscrupulous property agents either acting solely in their own interest or in collusion with developers are now numbered.
A
cross the country, aspiring property buyers are waiting for RERA - or the Real Estate Regulation Act - to be implemented by the states. Time and again, it has been stated that the consumer must consider the reputation of the builder prior to taking a decision to buy a property/asset which is likely to remain for generations.
about buying gold.
On implementation of RERA, only builders with sound reputations will remain in the fray - this probably its most important function in protecting consumer rights and interests. Once RERA becomes an enforceable law, it will change the ways in which residential housing projects are planned, offered, sold and possessed across India. Property buyers will no longer need to worry about unfair contracts, delayed possessions, nonnotified alterations in building plans and other risks. The aim of RERA is to make real estate purchase simpler by bringing in better accountability and transparency. In doing so, it will also infuse a lot more confidence among buyers – who, at the end of the day, should feel as comfortable about investing in a home as they are
Mandatory uploading of project details by the developer on the RERA website, including layout planning and completion schedule. 70 per cent of the advance collected from buyers needs to be maintained in a separate bank account and be used only for the stipulated project construction. These funds cannot be hived off for other purposes – a practice that has contributed to delayed projects. The individual state governments have reserved the power to alter the amount, but the principle is very much in place.
RERA lays forth several ground rules for real estate buying and selling, including: Registration of project with the appointed tribunal (with some exceptions). Nonregistered projects cannot be offered for sale or booked by promoters.
Establishment of Real Estate Appellate Tribunals that will handle any issues related to property disputes, with the intention of delivering quick and unambiguous resolution.
Setting up of an advisory body to deal with matters related to government-sponsored real estate development. In one of the most important addendums to RERA, brokers and the way they conduct their business now also fall under its ambit. The days of unscrupulous property agents either acting solely in their own interest or in collusion with developers are now numbered. In fact, RERA will protect both the buyer and the seller. For instance, it protects developers from non-payment. While the promoter is required to obtain necessary documentation such as completion certificate, the buyer is liable to be fined for delays in payment. Failure to register the property or comply by other regulations will lead to hefty fines and even imprisonment in certain cases. All this may sound too good to be true – and in fact, it is for now because RERA is likely to come into full force from May 2017. All the individual state governments need to get their ‘acts’ together to comply with its requirements and adopt it. The good news is that they do not have the option of not doing so – the Central Government has amply demonstrated that it is determined to push the Real Estate Regulation Bill through, come hail or high water. The Indian real estate market is showing positive signs of revival. Even as smaller builders struggle - now also because of the recent demonetisation - credible developers continue to launch new projects and raise funds to meet the
56 | CONSTRUCTION TIMES | December 2016
committed timelines. With RERA in place, several not-so-credible developers will go out of business. Buyers will be protected from players with ulterior motives, i.e. fly-by-night operators. This will, in turn, infuse a much-needed positive sentiment and consequently help increase demand. Increased sales will improve the cash situations of the credible developers that remain after the weeding out, and projects will be automatically delivered on time. Should You Wait For RERA? Currently, because of lower demand over the last two-three years, property prices across major cities have sunk incredibly low. Buyers have a wide range of options in locations, budgets, amenities and, perhaps most importantly, in developers. In previous times, buyers with budget constraints could only consider projects by builders with doubtful reputations and questionable business practices. This is no longer the case. Today, a home in a quality project by a trustworthy and reputable developer is very much an option even within a modest budget. RERA will take another year to be implemented; meanwhile, there are other dynamics which are changing on the Indian property market. Reduced pricing coupled with attractive deals in most cities, and the fact that more and more fencesitting buyers have run out of patience and are coming onto the market with firm ‘buy’ decisions, have kick-started the modest but very real recovery we are seeing on the residential market. In Pune, we have witnessed a 25 per cent increase in buying activity in high-demand areas like UndriPisoli, Ambegaon, Bhugaon and Wagholi in the last four-five months alone. In Mumbai, buying activity in Navi Mumbai, Thane and some other relatively affordable areas has also picked up significantly. What does this mean for property buyers? Very simply, any revival in buying activity eventually leads to increased prices. Such is the immutable law of demand and supply. Given that demand is increasing steadilynow, prices will begin rising even
before RERA becomes a market reality next year. What Experts Say Industry watchdogs unanimously agree that there is no scope for current property prices to decrease further. Whatever correction in prices could happen has happened, and developers cannot reduce prices further even if they wanted to – doing so would, in many cases, seriously impact their ability to stay on the market. In fact, RERA will mean that promoters will be bound by more procedures, and this may increase the cost of their projects - costs which are likely to be passed on to the consumer. In other words, RERA could be instrumental in inducing cost escalations in many cities. It should be noted that while RERA will ensure that unscrupulous developers and their business practices will be driven off the market, it will simultaneously ensure that builders with sound reputations and impeccable track records will become stronger. One of the most important intentions of the law is to support such developers so that they can continue to serve the needs of property buyers in the transparent manner they are known for. In short, for buyers who have no intention of dealing with any but the most reputed developers, there is no real advantage in waiting for RERA to kick in. If one is working with a reputed developer, the privileges, benefits and safeguards that it will bring already apply today. Another valid argument against waiting
for RERA before buying a property is that that once the Act is in place, it will become mandatory for builders to invest extra time with regulatory bodies to work along the extensive details of construction plans, clearances, approvals and other details related to their new projects. Paradoxically, this will in fact result in delayed deliveries where the opposite effect was actually intended. Even though many buyers feel that they should wait for RERA to be implemented before buying a flat, the fact remains that there are already many builders with strong reputations and credible market practices. Buying a property from such a player now instead of later can turn out to be wise decision if RERA results in upward pressure on prices. Also, if one is looking to make the most of current attractive pricing and offers, there is actually no better time than now. The time and effort spent in taking advantage of the favourable market dynamics existing today will prove to be the soundest investment. The sole proviso is that one should only patronize a reputed developer with a good track record for delivery and construction quality. Kishor Pate, Chairman & Managing Director of Amit Enterprises Housing Ltd. is the driving force behind one of the most successful real estate development firms in Pune and beyond. Apart from its signature luxury projects like Montecito in Sahakar Nagar and other premium gated townships, AEHL has also launched highly successful affordable housing projects like Astonia Classic and Colori in Undri and the Mediterranean-style township Astonia Royale in Ambegaon.
December 2016 | CONSTRUCTION TIMES | 57
Real Estate
REITs
Is REITs right for your investment portfolio?
Ashish Parwani, partner, Rajani Associates and Yogesh Nayak,senior associate, Rajani Associates, says the industry should be optimistic about REITs.
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Real Estate Investment Trust (“REIT”) is an investment vehicle wherein the money from investors is pooled and invested in pre-defined sectors with a predetermined objective much akin to mutual funds. In case of REITs, there involves pooling of money/ funds from investors (where investors get units in the REIT in lieu of their investment in the REIT) where the monies would be used solely for investing in revenue/ rent generating real estate properties and other permissible areas in the proportions as set out in the SEBI (REIT) Regulations, 2014 (“REIT Regulations”). The returns earned by the REIT would be then distributed to the investors in proportion to the units held by such investors. REITs typically make investments in office complexes, information technology parks, large malls, certain hotels & resorts, and residential complexes that have apartments on rent or lease.
the RBI for investing in units of REITs (which is set up in the form of trust) especially, in current scenario, where foreign direct investment in trusts other than FVCI investment in registered VCF is not permitted. Although the REIT Regulations provide for mandatory listing of units of the REITs, the level of trading activity in the units of REITs will have to be seen. The REIT Regulations would provide much needed transparency and is expected to make real estate a bit ‘organised’ to say the least.
Why REITs: REIT Regulations provides the real estate sector with alternative means to raise funds for the various projects. It appears to be a much needed respite for the cash starved real estate developers. The developers also stand to gain as there would be access to foreign funds for the real estate sector, an area which is closely monitored by the Reserve Bank of India (“RBI”). However, it will be interesting to see the categories of non-resident investors that may be eligible for such investment and terms and conditions that may be issued by 58 | CONSTRUCTION TIMES | December 2016
Another factor is that REITs also serve as a good avenue to look at monetising opportunities especially for developers and real estate companies which are struggling with enormous debts in their books of accounts. This is because in the commercial space, we are observing a gradual shift from ownership of properties to leasing of properties. Larger corporations and companies are, today opting to lease space and not buy property. Understanding the Government’s approach towards REITS:
REITs, in spite of having garnered a favourable response at large, certain issues pertaining to tax and stamp duty had initially kept the investors at bay. Fortunately with certain key announcements made by the Government of India coupled with certain amendments proposed by Securities and Exchange Board of India (“SEBI”), there is certain clarity providing much required comfort and optimism to the investor community. Certain amendments were proposed to the REIT Regulations by SEBI in its board meeting dated September 23, 2016 wherein, interalia clarity to the definition of real estate property is provided, REIT is allowed to invest in two levels of SPVs through a holding company subject to certain conditions, removal of the limit on the number of sponsors and introduction of the concept of sponsor group. SEBI is also expected to issue detailed guidelines for public issue of units of REITs. These proposed amendments are likely to
provide further impetus and generate further interest in formation of REIT. However, there are certain teething troubles in a few areas where the investor community is looking forward to speedy action from the Government’s which includes aspects pertaining to one time exemption/reduction on stamp duty. Investment Conditions: Investors keen on investing in REITs should be aware of the following conditions: • Invest in the properties, either directly or through a special purpose vehicle (SPV), controlled by the REIT; • Not less than 80% of the value of the REITs assets shall be invested in completed and revenue generating properties; • Not more than 20% of the value of REIT assets shall be invested in underconstruction properties, completed and not rent generating properties, mortgage back securities, listed/ unlisted debt of companies/ body corporates in real estate sector and such other avenues as set out under the REIT Regulations. However, investments in underconstruction properties and completed and not rent generating properties shall be restricted to 10% of the value of the REIT assets; • Investment in at least 2 projects with not more than 60% of value of assets invested in one project. • Distribute at least 90% of the net distributable income (after tax) to the investors; • Invest only in assets based in India; • Investment not allowed in vacant land or agricultural land or mortgages, other than mortgage backed securities; and • Cannot invest in units of other REITs.
The Investors outlook towards REITs: Investors as well as fund managers have started showing interest and a few the promoters have already tied up with investors. A lot of traction has taken place and we expect a lot more in the due course. Significant real estate players including DLF, K Raheja, Embassy and RMZ have either partnered with global investors or are meticulously working towards forging alliances. Many more such alliance and partnerships are expected to be formed whereby resulting in succour to the real estate industry. Most certainly, REITs will gather the long-term and HNI investors. Unlike other investment options, easy liquidity in the form of secondary sale of units of REIT will be bit challenging since the investor, who is seeking to exit from the REIT, will require to find another suitable buyer, who is ready to invest in such infrequently traded units of REIT. The investor, who is acquiring units of REIT, can expect two-fold earnings- firstly by receiving regular rent from REIT and secondly, the long term appreciation on such REIT properties. However, aforesaid two-fold earnings will lot depend upon market scenarios and real estate market in general. The favourable factor about investing in REITs is that it offers a far more foreseeable valuation process that is well-defined and where one can identify the assets. In India, the ecosystem for REIT has now been made almost as conducive as established REIT systems elsewhere. In light of the exemptions provided under the Finance Act, 2016 and the recent proposed amendments from the Government, industry players should be optimistic about the setting up of REITs which shall place India as a hub for REITs market and the real estate industry will be encouraged to have REITs set up in India as opposed to approaching other jurisdictions.
December 2016 | CONSTRUCTION TIMES | 59
Vox Pops
demonetisation
The Real Impact After the sudden decision of PM Modi, there was a lot of speculation on how demonetisation will impact the real estate market. The Indian real estate industry, has been trying to ascertain the cost-benefit analysis of its impact. CT tried to find from the experts in the industry what the real impact will be and how it will impact the transaction in the real estate industry as whole.
We welcome the bold step taken by PM Modi to demonetize Rs. 500 and Rs. 1,000 currency notes, as it will help to increase transparency in the real estate sector and curb unaccounted cash transactions. Being a professionally run organization, Rustomjee has carved a niche for itself in the ever-growing real estate sector over 20 years. The organization has always believed in transparent transactions which are for the benefit of the buyer and society as a whole. With this move we await a - Boman R. Irani, softening of the home loan rates as there Chairman and Managing Director, will be excess liquidity which can be a Rustomjee Group benefit to the home buyer. We foresee enhanced confidence of global investors looking to invest in the real estate sector.”
- Atul Goel, Managing Director, Goel Ganga Developers
It is not a ban but a change. Change is always a welcome move. It will bring in prosperity. Economy will grow. All sectors will benefit from this move. As far as real estate market is concerned, for general curiosity of whether property rates will increase or decrease, according to me, considering all logics the rates will go upwardly. But we will have to wait and watch. People who are holding money will have no option but to move the money which will lead market to start moving.
“The initial effect of demonetization is going to be a knee-jerk reaction of a wait and watch policy. The metropolitan cities will suffer the least, since the professionally run companies have started transparent dealings with all transactions routed through acceptable monetary platforms. There is marked trend in terms of business people, besides working professionals, taking bank loans to finance their property purchases. Industry also realizes that the luxury segment which has been suffering for the last couple of years will still take time to recover. The biggest beneficiary to this demonetization will be the affordable and mid-income housing since we expect the interest rates to come down substantially. Also, most buyers who have not been filing tax returns will definitely come under the income tax net now. Thus making it easier for them to get home loans at competitive rates.” 60 | CONSTRUCTION TIMES | December 2016
- Mudhit Gupta, CMD, EMGEE Group.
“We heartily welcome this path breaking step of demonetisation by our Hon’ble Prime Minister. He has done it with the clear intent of increasing the economic strength of all law abiding citizens, especially in the middle class and the poor. To enable this, the Hon’ble Prime Minister has stated that the demonetisation drive would push banks to cut lending rates significantly, triggering a revival in economic activity in the country. This move will subsequently improve liquidity and lowering of interest rates by 1%-1.5% in the next 12 months. With this, EMIs will also reduce by almost 12% signaling consumers to buy soon before demand and prices for housing move up. All these factors will have a spiralling effect on the ability of consumers to buy homes, impetus to real estate demand and the overall economic growth. More importantly, in the long run, the professional and well-organized companies in the real estate sector will significantly benefit from this move and the scourge of black money and corruption will eventually vanish from the sector. This is a win-win situation for both consumers and investors as transparency will increase and risks will reduce substantially over the next 6-12 months.” This is a historic, positive and amazing decision taken in the interest of economy of India. It will have a long lasting effect on real estate sector. It will surely clean up the system by improving the transparency. It will thus boost the foreign investments which will boost realty sector in long run.
- Abhishek Lodha, Managing Director, Lodha Group
It is a bold and welcome move by the Prime minister to fight against black money, corruption and terrorism.
- Shantilal Kataria, President, CREDAI Pune Metro
Due to this unexpected decision, psychologically the market will have temporary effect in particular segment of real estate like high end luxury products, secondary market like plotting scheme, raw land deals, unauthorized structures/ plots etc. Land deal may also slow down for some period due to current market situation and present cash flow problems. But the primary market will not be disturbed as inventory is always sold to end user who avail home loan. Organized part of the real estate sector will continue to do well. The operators who do un-authorized work will be affected badly. Given the market conditions around liquidity stress will be there.
Though it is a popular belief that Real-Estate sector attracts black money, it is not a ground reality. The black money element has vanished in the mass housing and all the established and - Sanjay Deshpande, Director, organized developers Sanjeevani Developers do not indulge in black money in the current era where customer goes for maximum possible housing loan. In fact the organized sector of Developers will benefit if they do not have to deal with this element in land deals and in corruption involved in obtaining sanctions and permits. As we are getting geared up for RERA this move will be complementary in our endeavor toward absolute transparency and reliability Shrikant Paranjape serves as Chairman of Paranjape Schemes (Construction) Ltd
Ultimately transparency will be improved and same will be helpful to attract the purchasers towards real estate sector. People’s trust over real estate will increase in long run.
Just demonetization of currency will not end the corruption. Only it will wipe out present black money and fake currency in circulation. The real estate sector needs complete transparency in every stage of project approval to project completion. If everything becomes online with no manual interference then only the problem of corruption & black money problem can be curbed.
CREDAI welcomes the bold decision of Prime Minister Narendra Modi.
In my view, this is a very temporary phase and in long term will not affect real estate sector in any ways.
December 2016 | CONSTRUCTION TIMES | 61
Feature
MIAL
Mumbai International Airport – Infrastructure and Design The Mumbai airport has a design capacity of 40 million passengers per annum, which, with constant efforts towards increasing efficiency, has been enhanced; the airport handled 41.67 million passengers in FY 16.
H
ome to a number of large corporations and financial institutions, Mumbai has gradually transformed into the country’s commercial, financial and entertainment hub. As the key gateway to India, the city has seen a steady flow of passengers streaming in and out of the city, from regions near and far. As the need for an entrance to this city was established beyond doubt, the foundation for the iconic Terminal 2 was laid, which now serves as the quintessential reception for visitors to the city. The Chhatrapati Shivaji International Airport (CSIA), rated as the Best Airport in the world in the 25-40 million passengers category by ACI, handles over 890 movements on a single runway connecting more than 90 destinations through 47 airlines. The Mumbai airport has a design capacity of 40 million passengers per annum, which, with constant efforts towards increasing efficiency, and with certain physical infrastructure changes, has already been enhanced to achieve an annual throughput of 41.67 million passengers in FY 16. It plans to further increase capacity through the reduction in spacing of arrival-departure-arrival aircraft, construction of taxiways and rapid exit taxiways, upgradation of secondary runway and associated taxiways, and restructuring of the Mumbai Terminal airspace. As one of the busiest airports in the world, it handles an average of 45 flight movements every hour, and continues to grow towards larger milestones.
The Mumbai Airport is a delightful unification of Indian art and design. The new elongated X-shaped terminal (one of the largest in the world without an expansion joint) combines international and domestic passenger services under one large roof, optimising terminal operations and reducing passenger walking distances. The long-span capabilities of the steel truss structure allow for the spacing of thirty 130-foot columns, generating a large columnfree central podium, reminiscent of the airy pavilions and interior courtyards of traditional regional architecture. Small disks of colourful glass recessed within the canopy’s coffers speckle the hall below with light, referencing the peacock, the national bird of India, and the symbol of the airport. The terminal at MIAL is designed
62 | CONSTRUCTION TIMES | December 2016
to maximise use of natural light. Strategically-placed skylights throughout the check-in hall reduce the terminal’s energy usage by 23 per cent, while a 50-foot-tall glass cable-stayed wall—the longest in the world—creates a transparent façade, going back to times of yore, allowing accompanying well-wishers to watch as their friends and family depart. The central lobbies are provided with open glass heat reflector ceilings and walls to utilise maximum sunlight while inhibiting maximum heat. This helps in curtailing air conditioning load during day light. Due to T2’s unique structure, the terminal has daylight in around 51 per cent of regularly occupied space and it also features building management system monitoring with stand alone control system interface with the power monitoring to create a truly energy‐
Feature
MIAL
efficient building. In recognition of these efforts, it has been awarded the Platinum rating by the Indian Green Building Certification with the highest ever score of 94. Just as the four-storey terminal celebrates a new global, high-tech identity for Mumbai, the structure is imbued with responses to the local setting, history, and culture. The interiors reflect heavy use of Indian textiles, custom chandeliers inspired by the lotus flower and traditional mirror mosaic work created by local artists. Over 7000 artifacts sourced from across India, put together for India’s largest public art programme project, ‘Jaya He’, featuring 1500 artists, elevate the ambience of the terminal beyond the typical, often unimaginative airport experience, spanning over 3 km across all four levels of the terminal. The sleek interiors of the terminal inspired by the design of a dancing peacock were made in a way to enable ample use of daylight making it one of the energy efficient structures. Huge comfortable seating arrangements for over 10000 passengers, 102 toilets, 161 elevators, escalators, travellators, an ample number of display boards and directions, a landscaped garden spread across an area of 2 lakh sq ft, parking facilities for 5200 vehicles, making it one of the largest car parks, are some of the
amenities that highlight the vastness of the new terminal. MIAL holds the ICI Dr Ramakrishna Award for Best Project with Pre-cast Concrete in India for its multi-level car parking facility. In order to speed up services for passengers there are 208 check-in counters, 23 domestic security pedestals, 30 international security pedestals, 60 immigrations counters on departure, and 72 immigration counters at Arrivals placed at T2. The automated baggage system handles 9600 bags per hour. The lounge encases a sprawling area of 30,000 sq. ft. across two levels and boasts of a stateof-the-art seating capacity of over 400. All this had resulted in faster and better services to the passengers, leading to CSIA being voted as the Best Airport in
64 | CONSTRUCTION TIMES | December 2016
India and Central Asia by Skytrax World Airport Awards 2016. The sustainability efforts at T2 are a continuous process and hence constant innovation is required at every level and phase of this process. MIAL is the first airport in Asia and the fifth in the world to release a ‘Sustainability Report’ as per GRI G4 reporting guidelines. MIAL contributes 1060 kWp of solar power towards saving environment through its plants installed at five different locations across T2 and cargo terminals. The airport also recycles 25% of the water used by every passenger with the help of three sewage treatment plants installed at the airport. The recycled water is then utilised for toilet flushing, cooling and in the airport’s green spaces. For its environmental endeavours, the airport has been awarded the GreenCo Award for the current year. With modern materials and technologies and cuttingedge strategies setting a new standard for sustainable, modern airport design, the terminal is as much a showpiece of the history and traditions of India and Mumbai, as it is an unprecedented structural and technological achievement. Over the years, GVK CSIA has turned into a truly global airport. Upgraded and modernised, this airport aims to meet international standards in terms of service, technology and facilities.
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feature
ports & shipping
Essar Ports Plans To Expand By 2017 Essar Ports Limited is in the process of expanding its capacity from 140 MMTPA to 170 MMTPA by the end of 2017 and to 194 MMTPA by 2019.
E
ssar Ports Limited (EPL) is one of the largest private sector port companies in India and has world class assets at strategic locations. It is in the process of expanding its capacity from 140 MMTPA to 170 MMTPA by the end of 2017 and to 194 MMTPA by 2019. Its state-of-the-art mechanised facilities are all-weather and offer round-theclock operations. They are designed to deliver best-in-class industry standards (deep draft, highest loading/ unloading rates, lowest turnaround times, environmentally-friendly). On the back of improved performance of its anchor customers, cargo handling has witnessed a good jump in the last three months. During March 2016, the company handled 6.25 MMT of cargo indicating a current run rate of 75 MMTPA. The contribution of third party in the total traffic is about 10 per cent. Growth in cargo was seen across all four operating ports, bringing credibility in performance. In addition, 20 MMTPA bulk terminal at Salaya was commissioned in March, meaning there will be additional traffic during FY 17. Company expects cargo handling to
increase from 59 MMT in FY 2016 to 85 MMT in FY 2017, registering a growth of more than 40 per cent a on year-onyear basis. FY 16 has seen: • Taking over Vizag project from VPT and achieving operational excellence through simultaneous projects and operations • Award of concession for expansion of Vadinar facilities by another SPM, two berths and associated infrastructure • Successful commissioning of Salaya Port • Receipt of approval for expansion of Hazira by 1100 m • Addition of significant third party cargo volumes at Hazira and Vizag Expected in FY 17: • 40 per cent - 50 per cent increase in cargo throughput reaching 85 MMT • Stabilisation of Salaya operations catering to Saurashtra region
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• Expansion of Hazira facilities by 1100 m • Commencement of Paradip Coal Berth Project works • Increase of third party cargo revenue to more than 15 pr cent and further to 25 - 30 per cent • Investment in excess of 1,000 crore EPL expects an investment of more than Rs 10,000 crore across existing facilities and concessions over the next three-five years in India. Additionally, EPL has plans for inorganic growth both national and international. Port profile Essar Ports Limited (EPL) is the holding company of all the ports and terminals of Essar. These include the liquid and dry terminals that cater to the oil, power and steel sectors, ore and coal traders, exporters and importers. EPL wants to align each vertical it serves with its relevant parent, while ensuring the operating companies were not impacted. To this end, EPL is undertaking a composite scheme of arrangement
feature
ports & shipping
of all its operating entities. It is being proposed that the shareholding of various operating companies be segregated into independent business segments so that the overall holding structure is rationalised and simplified, and the cross-holdings of the ports and terminals businesses are reduced. This will give each port or terminal a focussed platform for growth, as well as the scope to collaborate and expand independently. Cargo traffic at Indian ports has shown strong growth potential and has doubled to 1 billion tonnes per annum over the last decade. It is expected to reach 1.7 billion tonnes per annum by 2022. The Indian ports sector is performing well and several world-class assets have been created. With GDP growth of 7.5 per cent - 8 per cent, port traffic is expected to grow at a healthy rate for the next few years. In line with this outlook, Essar Ports is also expected to witness substantial growth in cargo volumes in the next three-four years. The cargo handling is expected to increase from 59 MT in FY 2016 to 85 MT in FY 2017, which is a growth of more than 40 per cent on a year-on-year basis. The share of third-
party cargo is increasing—it is expected to increase to 15 per cent by the end of FY 2017 and grow further to nearly 30 per cent over the next three years. Essar Ports has made an investment of approximately Rs 10,000 crore for development of port infrastructure in India. From a current capacity of 140 MTPA, it is in the process of increasing the capacity to 194 MTPA in India alone. The new capacity will be added through the expansion of the Hazira terminal from 30 MTPA to 50 MTPA, the expansion of the iron ore berths at the Vishakhapatnam Port Trust from 16 MTPA to 32 MTPA, and the development of a new 18 MTPA coal import terminal at Paradip Port Trust that will be the first mechanised coal import terminal in the port and will be capable of handling Capesize vessels. Total debt of Essar Ports is about Rs 7,000 crore or S $1 billion. The debt has been maintained at this level for the last four-five years. If capital is required to drive growth in the future, it will be infused through a mix of debt and equity, which is pretty much the norm for infrastructure financing. Essar
Port’s
five
operational
port
terminals are at Hazira, Vadinar, Paradip, Salaya and Visakhapatnam. The Hazira port is an all-weather, deepdraft port with 30 MTPA capacity that can handle dry bulk and break bulk cargo. Vadinar is also an all-weather, deep-draft port with 58 MTPA of liquid cargo handling capacity. It has two SPMs, product jetties, storage tanks, and rail and road gantries. The Paradip dry bulk terminal is an all-weather, deepdraft port with 16 MTPA of dry bulk cargo handling capacity. It has achieved the highest loading rate for iron ore at Paradip Port. The Visakhapatnam terminal is an operational 16 MTPA berth that was taken over in May 2015. The capacity is being doubled through a modernisation project that includes the mechanisation of one nonmechanised berth. The company’s newly commissioned dry bulk terminal at Salaya has a capacity of 20 MTPA. Essar Bulk Terminal (EBTL) Hazira is investing Rs 750 crore in the expansion project, which, along with the existing investment of Rs 2,450 crore, will take the total investment in Hazira port to Rs 3,200 crore. EBTL’s 550-metre berth in Hazira is being expanded to 1,100 metres to accommodate the steady growth in cargo throughput at the port. With the expansion, capacity of the Hazira terminal will increase from existing 30 MTPA to 50 MTPA. Post expansion, the port will have be able to handle seven vessels simultaneously at any point of time. With reduction in prices of LNG, its import for power generation and industrial use has now become viable. Imported LNG can cater to the natural gas requirements of Essar Steel for operating its gas-based iron making units, as well as Essar Power that requires gas for its two gas-based plants, which have an aggregate capacity of 1,015 MW. Given the requirements of these Essar companies, EPL is exploring the feasibility of developing an LNG import terminal.
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Insight
Safety
Safety Standards in India In Construction Industry I
n India, construction industry is the second largest employer when compared to agriculture. Throughout the world, the construction area of civil engineering is one of the most hazardous workplaces. The number of fatal accidents taking place at the construction sites is quite alarming and the major cause was found to be fall of people from height and through openings. In the present scenario, the Indian construction industry is quite large and complex involving latest technologies as well as man power. On par with the development of construction industry, drawbacks in terms of safety and health aspects are also observed. In the past few decades, need for safety awareness among construction industries has been realized. This is due to the high cost associated with work related injuries, workers compensation, insurance premium, indirect costs of injuries, and litigation. Every year, a considerable amount of time is lost due to work related health issues and site accidents. Lack of communication among the
various departments involved and lack of proper inspections are the major reasons for accidents occurring at construction sites. The construction site accidents may be caused due to the factors such as collapse of building parts and masses of earth, falling of objects and pieces of work on workers, people falling from heights, ladders, and stairs, loading, unloading, and transportation of loads, working on machines and with explosives. Across the world safety in construction industry is a matter of concern. In India this is one of the most vulnerable segments of the unorganised labour in the country. The industry being highly labour intensive safety should be comprehensively addressed at an all India level. A large number of workers are exposed to the risks of workplace accidents and occupational health problems. The rate of fatal accidents in this sector is four to five times that of the manufacturing sector. Safety measures to be implemented construction sites
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Construction Personal Equipment (PPE)
Protective
Eye and Face Protection Safety glasses or face shields are worn any time work operations can cause foreign objects to get in the eye. For example, during welding, cutting, grinding, nailing. Wear when exposed to any electrical hazards, including working on energized electrical systems. Foot Protection Construction workers should wear work shoes or boots with slip-resistant and puncture-resistant soles. Hand Protection Workers should wear the right gloves for the job (examples: heavy-duty rubber gloves for concrete work; welding gloves for welding; insulated gloves and sleeves when exposed to electrical hazards). Head Protection
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Insight
Safety
Wear hard hats where there is a potential for objects falling from above, bumps to the head from fixed objects, or of accidental head contact with electrical hazards. Hard hats – routinely inspect them for dents, cracks or deterioration; replace after a heavy blow or electrical shock; maintain in good condition. Hearing Protection Use earplugs/earmuffs in high noise work areas where chainsaws or heavy equipment are used; clean or replace earplugs regularly. Workplace Safety Vests Reflective safety vests are available in an array of colors.High-visibility items allow you to be seen by the drivers of those vehicles sooner and more readily. This fact increases your safety at work. Every effort must be taken to bring up the level of awareness among the employees as well as management about the importance of health and safety at work sites. It is highly desirable to decrease the rate of labour accidents for employee working in the construction industry all over the world. Many preventive measures to address this problem have been proposed and carried out. However, accidents keep occurring with depressing regularity. Hence, new effective measures for prevention of labour accidents are always keenly anticipated.
Construction projects carried out on large scale are following good safety measures as a separate safety department is available in these huge companies. But small scale projects taken up by local contractors are not aware of the safety requirements that could prevent construction site accidents. A safety culture needs to be developed as an integral part of the work culture of an organisation. It must be a basic
component of the management philosophy just as profit making is. The aim should be at providing a safe work layout and work arrangements which are conducive to promote the health and well being of the workers which ultimately generates the feeling of trust and loyalty among the workforce. With the advancement in technology there is more need for training the workers (operators) as per the latest tools trends and techniques so as to ensure safe operation of high tech equipment and to avoid any danger to human life. There is lot of awareness now, and most of the companies and agencies are implementing steps to ensure safety during construction. The greatest achievement would be completing a project with zero fatalities. We have a long way to go.ď Ž Sunil kumar Ladwa, Director Business Development Ladwa Solutions Inc
74 | CONSTRUCTION TIMES | December 2016
Insight
Project planning
Project Smart There is no quick fix solution to ensure implementation of best practices in a construction projects, says B A Madhukar, from Bangalore University.
O
ptimum time for delivery being a given, every construction project has 3 important considerations - Quality, Cost & EHS compliance. I have read somewhere that while constructing the Taj Mahal, thousands of people died due to non-existent safety standards at that time. We have moved a lot since those days and today, our clients and Client’s clients increasingly decide on collaborating with a certain agency only based on presence of strong systems & processes to mitigate the risk of EHS non-conformances on a project. Prevention of accidents leading to loss of life or limb besides providing hazardfree working environment both during & post construction stages is considered an essential requirement. This high priority is underscored right at the design & tender stage through elaborate discussions with all stakeholders of the project & leading to the project mandate highlighting the expectations of clients and their end-users. These are clearly documented as part of the vendor prequalification wherein significant rating is given to a vendor’s EHS track record and system compliance. Vendors scoring low on EHS hence lose out in a field where all other things being equal. Once the pre-qualification establishes compliance to basic expectations, the standards to comply like ISO 14001 & ISO 18001 as well as the relevant requirements of regulatory agencies form the basis of tender documentation.
The process starts with analysis of the risks associated with safety in a particular project. Factors to be considered include but not limited to whether work is carried out underground or with deep excavations, in confined areas or if project is a high rise, are effluents like bentonite that need to be treated prior to disposal are part of project have an impact on safety management system to be adopted at a site. Attention to detail at this stage in identifying & documenting potential risks & its mitigation go a long way in ensuring bringing in awareness among all stakeholders. The emphasis is more on prevention rather than on containment of safety issues. Accordingly, I have listed out some dos & don’ts, which may be handy as a starting point:
There is no quick fix or one size fits all solution to ensure implementation of best practices in a construction project.
As can be seen from above, a zero accident project does not happen by accident (literally & figuratively) or by
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chance but by meticulous planning, effective implementation and continuous monitoring. We have achieved more than 10 million safe manhours in a single project spread over 3 years as well as many projects logging in a million safe man hours each without incident. There has not been any instance of anyone on our project sites requiring hospitalisation in the last 10 years or so. This is the result of commitment of team, focus on making the site operations completely safe most importantly, we have been fortunate to be working with project owners who walk the talk by willing to spend reasonable amount time, efforts & resources on EHS enforcement. This is where, the project owner, being the most influential part of the eco-system, plays a major role in setting mandate, expectations and adequate resources for a zero accident project. So far, MNC Owners & those with exposure
Insight
Project planning
Dos Prepare a well thought out safety manual specific to the project identifying potential hazards & defining preventive action for each of the key activities & for the project as a whole Pre-qualify vendors who meet specific EHS requirements of the project (ex: if you are working on a project with 4 basements or is a top down construction, choose a vendor who has executed such projects successfully without any safety issues). Set out your expectations clearly to the contractors proposed for working on the project at time of tender and provide an opportunity for contractor to quote for complying with specific requirements of the project on EHS matters Inform clearly & in no uncertain terms your no nonsense approach to safety compliance at the site and your expectation of total compliance by the successful bidder at the pre-bid meetings to underscore your commitment.
Set out the Implementation, Monitoring & Control mechanisms clearly including regimented meetings, workshops, training programmes, audits & reporting as well as process for closure of non-conformances, escalation & management responsibility for all contractors working on project Having put in place high expectations & a strong system in place, be prepared to get your hands dirtied & micro manage the activities to ensure end results meet intended objectives An experienced & well-trained team to manage EHS aspects of a project is key to success. Empower the EHS officer & make them report only to the management
Conduct periodic review of system conform ance including non-conformances, corrective action taken & trend analysis to ensure that there is continuous improvement in key areas. No point in simply documenting the records unless it is used to monitor & improve. Display prominently relevant languages safety signboards, Safety Key Information boards, safety shelters, safe assembly points and safe access routes to make everyone at site aware of dangers & their responsibilities.
to best practices, due to precedents set elsewhere or process requirements have a much better record in achieving this but
Don’ts Avoid tendency to copy & paste a generic report or process from another project or company since project risks can vary significantly and perspectives differ. Keep the manual brief and to the point. Avoid unwanted processes, checklists and procedures that are not applicable or not necessary for the project. Avoid tendency to go with brand names & marketing gimmickry of vendors. Insist on seeing evidence of demonstration of safe work practices by visiting on-going works & inspecting the records of the project as well as discussions with project owners. Demand and see records of tool box meetings, EHS meeting records, non-compliances record of projects completed and evidence of continuous improvement before deciding on the vendor. Don’t assume that the contractors know all since they are experienced or they flash their certificates. Insist on verifying their implementation mechanism & interview the key persons proposed for the project to understand their commitment levels. Most accidents happen due to lack of knowledge / carelessness at the lowest levels of implementation and an effective system & process can do wonders in prevention. Avoid generating thick documents that are copied lock, stock & barrel from some other company or project. The chances are, too much will lead to too little focus. It is desired that you prepare a brief, practical & project specific EHS manual that addresses the specific requirements and is easy to implement, monitor & control. Most owners, consultants & contractors get into a chaltahai mode after the initial euphoria & big banner launch until they are jolted back into reality by accidents putting entire projects at risk. It is better to have a sober, hands-on approach that involves systematic review at regular intervals. Don’t take the mere presence of checklists, method statements & manuals as surety for safety at site. Even the best laid plans come a cropper if not implemented effectively. As the saying goes ‘the devil is in details’, put in place an effective doer & checker mechanism to ensure what is planned is implemented effectively. Have fortnightly & monthly EHS audits for compliance and more importantly, follow up & close on all non-conformances. These NCs should become part of the next training programme. Ensure the closure reports reach the highest levels of management so that there is ownership. Don’t be a “big picture” guy & ignore details when it comes to safety since the next victim could be you. Most managers & senior executives often get into jargons like “it has been taken care of” or “someone is managing it” or “it will be done” without really having the necessary back-up process to ensure effective implementation. Remember – “Plans don’t fail. It is the effective implementation that fails” Don’t put in place a team just on paper or deploy a team that is ineffective or not trained for the job responsibility. Avoid conflicts of reporting where the reporting officer might be the person responsible for EHS non-conformance and get all EHS non-conformances reported directly to the highest levels of management. In most instances of accident investigation it is noticed that the safety supervisor or the officer at ground level is not empowered to report hazards directly to the right persons resulting in his reports / warnings getting lost in the maze of reports / emails which nobody gives much importance causing the morale of the EHS person to drop down. Don’t trash the reports or the meetings on grounds of “not my responsibility” or “someone is looking into it”. The chances are nobody is looking into it and everyone will look at each other’s faces when there is an incident!
Don’t limit the efforts to only preparation of manuals & nice looking internal reports that are for consumption of visitors only. Don’t presume everyone at site knows how to read. Use of cartoons & graphical / pictorial displays may be more effective especially when dealing with illiterate or semi literate workforce.. Some pictures are attached.
the trend is shifting now with many local project owners also realising the tangible & intangible benefits of a zero accident
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completion and taking steps to move closer to perfection. The bar is definitely raising.
Insight
Project planning
In so far as the way forward is concerned, we have seen significant reduction in incidents & accidents while managing projects. All projects carry risks and challenge lies in reducing infinite risk to finite & once there, drilling down to control. One successful project leads to another and so on. The results so far are very encouraging and perhaps the time is not too far when we can expect best practices from around world being implemented in all projects rather than in a select few projects as is being done right now. The regulatory framework is there, the intent is there and a little bit more commitment from all of us can get us there. I come from a school of thought where the besides putting the onus of safety in construction site on contractor, the owner also commits to compensate the contractor extra over for ensuring that the expectations are met. This is antithesis of tendency of most project owners who tend to bundle everything under the sky in the responsibility of contractor without giving him the opportunity to price for the item separately. Most project owners are guilty of not knowing what specifics to get from the contractor and end up using terms like “everything necessary to ensure zero accidents” or “it is sole responsibility of contractor to adhere to all requirements” etc. Having
said this, there are several mechanisms in which a contractor is compensated for the investments he makes on EHS practices in a project. In some forms of contract, we provide a pricing option for contractors to quote. In some others, the contractors are provided with incentive (generally as percentage of the contract) for ensuring zero accident performance. Whereas these are tangible ones, there are other (and much larger) intangible incentives to the contractor like a happy & healthy workforce, recognition from Owner leading to repeat business saving on business development cost, premium being paid by Owners for working
Category Type
What it covers / consequence
Category A
Matters related to statutory non-compliances & those that may be fatal
Deep excavations
To be closed within a set timeline of one to three working days since it may get escalated to Category A if neglected
Use of wrong shoes / helmets/gloves may lead to injury etc.
Category B
Examples of Activities
Formwork support Contamination of earth
Exposed electrical contacts / junction box may lead to electrocution Fire extinguishers reaching their expiry dates
Category C
Nothing seriously wrong but more of process improvement & could be closed in about a week.
Waste collection bin not provided Gas cylinders used for welding are not latched properly
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Action to be taken Permanent solution to be implemented on utmost priority & followed up with periodic conformance audits Process driven approach by use of checklists & sign-off cards prominently displaying originator, responsible person & checker with date & signature
Daily site walk-around & tool box meetings to continuously educate the workforce
with an accountable contractor and recognition by the government & authorities to name a few. Many of our projects have been recognised & awarded for best Safety Site and other recognitions by Governments & other industry bodies which give much encouragement & motivates contractors besides giving much recognition in industry & professional circles which would also act as a big incentive to the contractors to keep up the good work. Hazardous Activity Analysis One of the key ingredients for mitigating risks in a project in my opinion is taking a professional approach to analysing each hazardous activity that is anticipated in a project. As a subject, analysing each activity for its hazard quotient and taking a preventive view based on the severity would be the most desired way of managing risks to the project. However, considering the complexity of such a study, I would suggest the following categorisation of Hazards & pigeon-holing each of the activities under different heads would be the first & easier step towards same. Maintaining a log of all categories of hazards and its effective mitigation at highest levels goes a long way in prevention. In so far as construction industry in India is concerned, the safety record
Insight
Project planning
varies in different sub-sectors. I can say we are almost on par with best practices from around the world when it comes to projects involving MNC clients with legacy systems & processes with strong emphasis on implementation & enforcement. Some of these sectors are in IT / ITES workspaces, pharma, space technology, biotechnology & automobile industries, R&D centres where our industry has made rapid strides in implementation of global EHS
best standards. On the other end of the spectrum, there are projects in other sectors like housing & infrastructure and some public sector projects that are perhaps about 15 years behind in terms of awareness & effective implementation. This can perhaps be explained by lack of enforcement by the concerned regulatory authorities or the project owners. Even best contracting companies are guilty of having dual standards citing “ the client is not
insisting of safetyâ€? indicating that we still have some way to go before we can claim to be fully conscious of our responsibilities on this front. We also need to have many more training institutes with high quality trainers adept at giving a practical & hands on training to meet the ever increasing need for EHS professionals in our industry. This training infrastructure shortfall coupled with an effective regulatory framework is something that developed countries like Singapore & Germany seem to have addressed prior to setting very very high standards of EHS in construction industry. A construction worker typically spends a minimum of about 60 hours per week in making his ends meet. Assuming that he has a shelf life of about 35 years (as most of us do), that is a very long time spent at site working in the exposed conditions, which can be very hazardous & risky. When unchecked or un-supervised, he is bound to catch some chronic illnesses like chest & eye infection, high stress levels, noise pollution, skin irritation to name a few all of which affect his productivity. Risk-Environment Impact Assessment Forms can be designed for each critical activity & implemented to ensure due diligence prior to commencement of activity. Designing a safe work environment striking a balance between the individual, the hazard, social responsibility and financial outlay that can be set aside, though tough to achieve, will lead to long term sustainable practices good for the society as a whole. A common EHS code or handbook for all construction projects in a particular region regardless of the type of construction, devised by group of concerned professionals including Developers, Architects, Consultants, PMCs, EHS professionals, Government representatives and associations like BIA, INSTRUCT and others can be a good starting point that can be taken up by Construction Times as an initiative to raise the bar and improve awareness in this area. ď Ž
82 | CONSTRUCTION TIMES | December 2016
Case Study
Railway bridge
Construction of Cable-Stayed Bridge Over Barddhaman Railway Yard in West Bengal G
PT-Ranhill (JV) was awarded the work of construction of a 4-lane cable stayed road over bridge at Barddhaman Railway Yard in lieu of the existing distressed 2-lane ROB. The client was Rail Vikas Nigam Limited (RVNL), and the job was unique from the planning, design and execution viewpoints. The primary challenge was the construction of the steel composite superstructure over nine electrified railway tracks of the highly busy Howrah-Delhi trunk route of the Eastern Railway. An innovative scheme of construction, by means of a deck erection crane, was designed to undertake the erection of the deck during short duration traffic and power blocks. At each stage of construction, stay cable forces and pylon and deck levels had to be monitored to ensure the final geometry of the completed structure. This paper discusses the problems faced and the engineering solutions, as well as some of the lessons learnt.
structure, and movement of heavy vehicles is not allowed over it. Planning and Design The 2-lane ROB is of steel framed columns and steel composite construction, with solid earthen bank retained by brick masonry retaining walls in the approaches and in the centre of the station. In view of these restrictions, the new bridge was proposed as a single long span bridge, spanning over the entire railway yard, which would remove the existing structural bottlenecks, and provide flexibility for the future remodelling of
124 mtr over the Railway Yard. The key dimensions and type of construction are as shown in Table 1 and 2: Construction Challenges In the case of Barddhaman ROB, there were two broad hurdles that had to be overcome. The construction of a cablestayed bridge itself – even in a remote and open space – lends itself to various technical and construction challenges. Construction of cable stayed bridges is still at a nascent stage in India, and in addition, the unique challenge of the project arises from the necessity of
Effective Overall Span (c/c of Common Piers, CP1 to CP2):
188.429 m 64.266 m
RCC Backspan (CP2 to Pylon) Steel Composite Main Span (Pylon to CP1)
124.163 m
Overall Width of bridge deck at main span side
27.700 m
Overall Width of bridge deck at back span side
28.200 m
Carriage Way Width in each direction (incl. 1.5 m footpath)
9.0 m
No. of Lanes in each direction
2
Introduction
Cross Slope
Barddhaman (BWN), located about 100 km from Kolkata, is one of the busiest junction stations on Eastern Railway’s network. It is located on the HowrahDelhi trunk route, through which several important trains, including Rajdhani and Shatabdi Express trains pass daily. This station is also an junction station, providing rail connectivity to several interior regions of West Bengal. With more than 100 EMU, long distance and freight trains passing through the station on a daily basis, the station has nine electrified tracks and eight platforms. The existing 2-lane structure is highly inadequate for the location, considering the volume of traffic flow. It was constructed more than 70 years ago, and has now been classified as a distressed
Height of Road Deck from Track
7.500 m
Height of Pylon over Road Deck
54.768 m
Clearance above Railway Track
2% 6.500 m
Key Dimensions
the yard, thus aiding in better and more efficient train operations. As such, a 4-lane cable-stayed bridge as shown in Figure 1 was proposed with 124 m long main span over the railway yard, anchored to 64 m long RCC monolithic backspan. Salient Features Of Bridge The bridge has been designed keeping adequate provision for future expansion of the Barddhaman Railway Yard. As such, the pylon has been placed outside the yard area, thus necessitating the requirement of an obligatory span of
84 | CONSTRUCTION TIMES | December 2016
construction of such a complex structure across a busy railway yard in an urban setting. Clearly, the risks involved in construction of Barddhaman Cable Stayed ROB were exponentially higher, as compared to a similar structure across a river bridge or valley. As the construction work proceeded, several foreseen and unforeseen hindrances had to be overcome with innovative solutions. Construction Across a Railway Yard The presence of nine electrified railway lines and eight passenger platforms
TYPE OF CONSTRUCTION Common Pier (CP-1)
14 nos. x 1500 mm diameter bored cast-in-situ piles having 25 m depth. RCC pile cap of 28.9 m x 6.7 m.
Common Pier (CP-2)
21 nos. x 1500 mm diameter bored cast-in-situ piles having 25 m depth. RCC pile cap of 28.9 m x 10.9 m
Pylon
27 nos. x 1500 mm diameter bored cast-in-situ piles having 35 m depth. RCC pile cap of 37.9 m x 10.9 m. The pylon consists of 3 nos. of 2.0 m x 2.5 m box sections made of HT (E410) grade steel. Provision of stairs and platforms was kept inside the pylons for movement of people during construction and maintenance.
RCC Backspan
Monolithic RCC span of 64 m length was provided as anchor to the main span over the railway yard. The entire backspan is of M-50 grade concrete, and consists of 2 nos. side beams of section 2.5 m x 1.8 m, central beam of 2.5 m x 2.0 m, and 750 mm thickness of deck slab. Total volume of concrete was approx. 2240 m3.
Main Span
The main span is comprised of 10 panels, with each panel consisting of 3 nos. longitudinal box girders & 6 nos. I-section cross girders, with HT (E410) grade steel. The 250 mm thick deck slab (M-50 grade concrete) is connected to the steel girders by 25 mm ø x 150 mm long shear studs.
Stay Cable
3 planes of cables with 9 cables each on main span and back span in each plane. Parallel Strand System of M/s Freyssinet has been used.
Monitoring Devices
6 nos. electromagnetic sensors have been provided on 6 central plane cables subject to maximum loads. The sensors are connected to a central server, and results can be monitored remotely through a web-based interface.
below the 124 mtr long mainspan created unique challenges for the construction team. The clearance of the 25 KV OHE wire from the soffit of the girder is less than 800 mm in some cases. Stay Cable Installation & Stressing The work of supply, installation and stressing of stay cables was executed through M/s Freyssinet International, France, who are the world leaders in stay cable technology. The various elements of Freyssinet’s Parallel Strand System (PSS) are explained below. Besides the quality and specifications of stay cables, M/s Freyssinet deployed highly sophisticated, state-of-the-art equipment for the stay cable installation and stressing works. Lessons Learnt The completion of such an engineering structure after overcoming the challenging site conditions and proximate risks, gives immense satisfaction to its builders; however, the construction process also allows us to learn invaluable lessons about engineering, construction practices, and project management. A few of the important insights are as follows: Safety Arrangements Such types of works expose the construction personnel to various
hazards, including working at heights, constricted spaces, proximity to HT electric lines, etc. It is important to address and mitigate such risks before commencement of the work. The safety measures adopted at the Barddhaman project site go above and beyond merely using personal protective equipment (PPE). In preparation of the HSE plan, each activity of the work has been studied minutely and risks have been identified and steps have been taken to address associated risks. Some of the aspects of the safety plan include: Provision of proper illumination and safe access to all working locations, in the form of well-designed temporary staircases, hand-railings, working platforms, walkways, etc. Use of properly designed slings and load-tested cranes for all erection activities, regular maintenance and
third party certifications of the same Provision of lifelines and fall arrestors for all workers working at a height Earthing of all structures and equipment in vicinity to high tension electric line Emergency evacuation plan and temperature control for working in congested surroundings (i.e. inside pylon) Adopting safe work practices and imbibing culture of safety and awareness among workers Conclusion Construction of cable-stayed bridges is still at a nascent stage in India; however, the use of the technology for bridging large spans is inevitable in the future – be it long-span river bridges, deep gorges, or across existing highways or railways in urban settings. By adopting suitable construction methodologies, project management and safety practices, cablestayed bridges can be the solution for various civil engineering challenges as well as safer and more aesthetic structures. Execution of such mega-projects test the technical and managerial acumen of the construction team, but at the same time, offer considerable professional and personal fulfilment.
December 2016 | CONSTRUCTION TIMES | 85
international
talk
London’s tallest building construction approved The 73-storey building, towering to a height of 305 metres, won approval despite a protest from the Royal Palaces because of the impact it will have on the iconic Tower of London, a UNESCO world heritage site. This would provide a significant increase in flexible office accommodation, supporting the strategic objective of the City of London Corporation to promote the city as the leading international financial and business centre. This building will a vote of confidence in the City of London. 1 Undershaft will crown the cluster of tall buildings and will be a tower London can be truly proud of.
Detroit Brush Park construction to start
Enhancing Quality and Safety in the Construction Industry UBM Malaysia is organising Ecobuild Southeast Asia 2017, to be held from 12 to 14 April 2017 at the Kuala Lumpur Convention Centre (KLCC), hosted by Construction Industry Development Board (CIDB) Malaysia. This event is for sustainable design, construction, energy and the built environment, with the theme for the year is ,”Towards Enhancing Quality & Safety in Construction”, pits perfectly with one of the pillars of the Malaysia Construction Industry Transformation plan till 2020(CITP).
Construction machine sales strengthening in Italy Construction machine sales are strengthening around the globe. A report from the SaMoTer-Veronafiere Outlook reveals that 7,551 construction machines were sold in Italy over the period from January-September 2016. This represents a gain of 32% from the same period in 2015 and a further increase of 37% is estimated in Italy for the two-year period 2017-2018. Worldwide the first nine months of 2016 saw sales around the world of 496,500 earth moving
Construction is to start on a 410unit residential development in Detroit’s Brush Park. The mixeduse project just north of downtown is Detroit’s largest residential neighborhood development in decades. It will include townhomes, duplexes, carriage homes and apartments. The community is intended to be high-density and walkable and comes at a time when demand is growing for housing in and around downtown.
86 | CONSTRUCTION TIMES | December 2016
machines, a drop of around 5,000 less (1%) compared to the same period in 2015. The setback was particularly noticeable in the first quarter, although there was better overall stability in following months. The period JanuarySeptember saw performances emerging markets stand out, with China growing 8% and India jumping up by 31%. There was also an 11% gain in Western Europe. However sales fell by 3% in North America and 24% in Japan.
China to develop world’s fastest Maglev train capable of 600-kph
Chinese train manufacturer have announced to begin production of world’s fastest maglev railway, which will allow trains to travel at up to 600 kilometers per hour. The first prototype is expected to be delivered in 2020, and the test track will be built in Shandong province. Based on electromagnetic induction, maglev trains are suspended over railway tracks. Thanks to the consequent reduced friction, the travelling speed of maglev trains is twice that of the fastest high-speed train, and close to that of airplanes.
IranConMin 2016 promotes construction and mining ties
Munich-based international exhibition company Internationale Messe- und Ausstellungsdienst (IMAG) is partnering in or organising eight trade fairs in Tehran. One of the most important of these is IranConMin, the international trade fair for construction machinery, mining, building materials and the natural stone industry, being held from 5-8 November 2016, at the Permanent Fairground in Tehran. This is the twelfth
edition of the show, which last year attracted 200 exhibitors, around half of them from abroad, and 19,000 visitors. This year, there will be national pavilions from Germany, China, Korea and Finland. The event offers a wellestablished platform to present products, innovations and solutions to a receptive clientele in one of the most important growth markets.
New flights will build airport for long term
Asian Railway inaugurated
A bevy of construction projects around the Dayton International Airport, along with some recently-secured new flights, will enhance the facility as its director sees a long-term plan to keep traffic stable.
The Afghan President Mohammad Ashraf Ghani inaugurated the Asian International Railway , the Afghan government remains committed to turn all the bordering provinces of the country into major economic hubs. The inauguration of the railway connects Afghanistan with Turkmenistan. The country will be connected via railway networks with Iran in the West and some other regional countries, including India.
The
airport
suffers
from
aging
infrastructure, with the main part of the terminal approaching 60 years old, and other parts of the airport being built on incrementally after the 1950s. But when it studied building an all-new terminal, Slaybaugh said that turned out to cost $350 million and was not affordable. Instead, the 356,000-squarefoot terminal will see incremental modernization projects - $123 million in construction over a decade, beginning with a $30 million rehabilitation entrance area and driveup. The airport has sent out requests for proposals on the project and in the coming weeks it will sell $30 million in revenue bonds to pay for this project.
The construction of a railway line between Afghanistan and Iran officially kicked off near the western Herat province of Afghanistan in the month of September this year. The railway line will be established from Iran to Ghoryan district and will further go towards Zindjan district and Herat Airport.
December 2016 | CONSTRUCTION TIMES | 87
international
talk
Qatar 2022 World Cup stadium works in full swing Construction work on eight of the proposed host venues for the 2022 FIFA World Cup is in full swing, the Supreme Council for Delivery and Legacy (SC). Khalifa International Stadium – the first host stadium – is on track for completion in the first quarter of 2017. The stadiums have been designed by a variety of leading architects to reflect different aspects of Qatari culture while also keeping three key priorities in mind – access and comfort, sustainability and post-tournament legacy. For the Khalifa International Stadium, the SC said that construction is moving at a rapid pace, with external cladding and LED screens coming up around the exterior of the venue.
Canada seeks builders of Gordie Howe International Bridge
Work on international convention centre in Newport to start next year. Work on the £100m International Convention Centre Wales, which is set to be built at the Celtic Manor Resort, Newport, is set to start on February, 2017.
The 60,000-seat Al Bayt Stadium at Al Khor C is scheduled to host the semi-final matches at the tournament. Construction of the project is well underway, with the recent successful installation of elements of the main structure taking place. Current ongoing works include the construction of access tunnels to the stadium and bridges to the venue.
The work had already started to clear the site for the 26,000 sq ft convention centre on a site at the resort and that building contractors would move in to start the actual building work in February. The City Campus of the University of South Wales in Newport city centre, that the new building, which would be open by June 2019, would dwarf the existing Celtic Manor.
Chinese firm to build Zambia – Malawi Railway
The Windsor-Detroit Bridge Authority on Thursday released a Request for Proposals for construction of a new six-lane bridge across the Detroit River. Canada plans to cover the cost of building the $2.1 billion Gordie Howe International Bridge, plus a $250 million customs plaza on the U.S. side. Toll revenues collected on the U.S. side of the bridge will go toward repayment for the American share of the project. The authority in July issued a request for qualifications, in which contractors’ ability to handle the massive project was evaluated ahead of the request for proposals.The project includes the 1.5 mile bridge, Canadian and U.S. ports of entry, customs plazas, a tolling station on the Canadian side and a connection to I-75 in Michigan.
The Ministry of Transport & Communications has awarded China Civil Engineering Construction Corp a US$2•26bn four-year contract to design and build the Zambia East Line, which would run for 388•8 km from Serenje on the Zambian Railways network to Petauke and Chipata. Chipata is the terminus of an existing 1067 mm gauge line from Malawi which offers onward
88 | CONSTRUCTION TIMES | December 2016
links to Mozambique. Construction of the Zambia East Line would create a 1 500 km corridor from Kapiri Mposhi to the Indian Ocean at Nacala, significantly shorter than the current rail routes via Zimbabwe or Tanzania. The single track line would be suitable for passenger trains running at up to 120 km/h and freight trains running at 80 km/h.
ConstruCtion times Builders Awards 2017
Place : Mumbai Date : April 29, 2017
Glance of Construction Times Builders Awards 2016
international Infrastructure quality – gaining a competitive advantage The Lithuanian railway company AB Lietuvos geležinkeliai (hereinafter – Lithuanian Railways) is a commercial company managed by the State. The principal purpose of Lithuanian Railways is to generate added value (i.e. revenues to the State) from freight carriage by rail. Lithuanian Railways earns most of its revenues from international rail freight operations. Plans for the future are equally ambitious with a total of approximately €750 million intended for investment in the development of railway infrastructure, and maintaining its technical level.
talk
Indians Invested Rs 13,600 crore in Dubai Realty
Indians have by far remained the most prolific foreign investors into Dubai realty, outshining capital inputs from British, Russians and all others. As per the data from Government of Dubai’s Land Department, Indians have once again topped the charts as the number one investor in Dubai realty with a whopping investment of Rs. 13,600 Crore ($2 billion) into the sector in the first half of 2016 alone. Overall, Indians have pumped in a total of Rs. 1,24,440 Crore ($18.3 billion) into Dubai realty since 2011. Dubai’s real-estate sector gives you your money’s true value for what you purchase. For instance, in London, a 21 sq m unit would cost Rs. 6.8 crore (USD 1 million), whereas in Dubai, you can buy approximately 145 sq m unit with the same amount of money with no compromise on quality.
Chinese Investment In US Real Estate Going Strong As China’s property market experiences yet another real estate bubble that authorities are attempting to control with new restrictions on home buying, citizens are continuing to look abroad for stable investment in U.S. property markets. According to an Asia Society Special Report, Chinese investment in residential property amounted to $93 billion between 2010 and 2015, while that in commercial property rang in at $17.1 billion over the same period. Despite the implementation of capital controls this year designed to restrict capital flight, through pressuring insurers to reduce overseas investment and asking banks in Shanghai and Shenzhen to limit dollar buying, Chinese demand for U.S. property remains strong. As of August 2016, the U.S. has already drawn $13 billion in real estate investment commitments from China. 90 | CONSTRUCTION TIMES | December 2016
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ADB approves $100mln loan for infrastructure development The Asian Development Bank (ADB) on Monday approved $100 million in loan to co-finance a project aimed at improving public-private partnerships for infrastructure developments in Sindh. The UK government’s Department for International Development will also co-finance the project with $19.23 million in grant and $4.75 million in technical assistance, while the provincial government will contribute $65 million. The project’s combined cost is estimated at $188.98 million.
The Manila-based lender, in a statement, said the loan will strengthen the standards in the development and delivery of the public-private partnership (PPP) projects and help bridge the infrastructure investment gap. The financial and technical assistances will help in leveraging private capital to augment infrastructure investments. Infrastructure developments will create jobs, generate income and improve economic growth in the province.
India part of building the NS Rail Corridor India should take an active part in the development of the North-South International Transport Corridor, To develop the transport corridor, it is of great importance that a shipping service is established between the sea ports of Mumbai (India) and Bandar Abbas (Iran), as per reports. The effective development of the Caspian Sea Region’s transport infrastructure will have a positive impact on the dynamics of trade, capital flows and investments, and the economic well-being of countries in the region. Despite the difficult economic conditions, the volume of traffic on the North-South ITC, during the past three years, has slightly increased.
France’s solar road: International solar experts give their analysis The construction of a solar road in France is turning numerous heads due to the novelty value of the project, however, solar experts have a different view, seeing the construction as economically unviable, and actually damaging to the solar industry. A 340 kW solar road is currently under construction in Normandy, France. It will be one kilometer long, with a surface of 2,800 m2, according to Michel Salion from the Colas-Wattway press team, a subsidiary company of Bouygues S.A. Although advertised on the French Ministry of Ecology website as having the capacity to deliver 17,963 kWh per day, in actual fact it will generate just 767 kWh per day. In fact, Segolène Royal, French Minister of Ecology, announced that one kilometer
of the solar road will deliver enough electricity for 5,000 houses. This is also wrong. With 767 kWh per day - official data from Michel Salion –
92 | CONSTRUCTION TIMES | December 2016
it will just be able to power 50 French homes. The cost of one kilometer of the solar road is EUR 5,000,000, which works out as EUR 100,000 per each home that is powered by the road.
EARTH MOVING EQUIPMENT
HIGHWAY EQUIPMENT
MINING EQUIPMENT
ABOUT IESC The Infrastructure Equipment Skill Council ( IESC ) is a 'Not for Profit' sustainable organisation promoted by the Indian Construction Equipment Manufacturers Association ( ICEMA ) and supported by the Confederation of Indian Industry ( CII ) and funded by the National Skill Development Corporation ( NSDC ) to spearhead the skilling of workforce in the Infrastructure Equipment Sector with primary focus on training and certification of operators and mechanics. The Council was formed in August 2014 and commenced operations during November 2014, is governed by 18 member Governing Body from various segments of the Industry along with representatives from Department of Heavy Industries, Academia and National Skill Development Corporation.
MISSION To train over million Operators & Mechanics in ten years To have 5000+ Certified Trainers in over next decade To accredit 400 Training Organizations meeting Global Standards Pan India
Contact: Infrastructure Equipment Skill Council 23-29, FF5, First Floor, "White House Building" St. Marks Road, (Opp SBI) Phone: 080 - 42126666/42146666 Bengaluru - 560001 Twitter: IESCBlore www.iescindia.com
events EVENTS
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National REDECON 2016 International Conference Roadtech Date: -12th NOVEMBER 2016 Date: 09th August 12-2016 Venue: Venue: NIMHANS New Delhi Convention Centre, Bengaluru, India Website: Website: www.accehq.net www.assocham.org
UMEX 2016 FRONTALE INDIA 2017 FENSTERBAU Date: 23rd August 10-12, 2016 2017 Date: - 25th February Venue: New Delhi Venue: India Expo Mart, Greater Noida, India Website: www.frontale-india.com www.umexonline.com Website:
bauma China 2016 Tech India Expo 2016 Date: -25th November Date: 22nd August 10-12, 2016 2016 Venue: Venue: Shanghai New DelhiNew International Expo Centre, China Website: Website: www.bauma-china.com www.techindiaexpo.com
REDECON 2016FARE BRICS TRADE Date: -12th NOVEMBER 2016 Date: 09th Oct 12-14, 2016 Venue: NIMHANS Convention Centre, Bengaluru, India Venue: New Delhi Website: www.accehq.net Website: www.ficci.com
The Big 5 Construction India2016 2016 India Infrastructure Summit Date: September 28-30, 2016 Date: 16 November 2016 Venue: New BEC,Delhi Goregaon, Mumbai Venue: Website: www.indiainfrastrucutresummit.com www.thebig5constructindia.com Website:
Wire & INDIA Cable India 2016 CeMAT Date: October 2016 2016 Date: 01st-03rd5-7, December Venue:MMRDA MumbaiGrounds, Bandra Curla Complex, Mumbai Venue: Website: www.win-india.com www.mdna.com Website:
The Tube India International Industrial Automation INDIA 2016 Date: 01st-03rd October 5-7, 2016 2016 Date: December Venue: Mumbai Venue: MMRDA Grounds, Bandra Curla Complex, Mumbai Website: www.win-india.com www.tube-india.com Website:
Powder & Bulk Solids India 2016 MDA India Date: 01st-03rd October 13-15, 2016 2016 Date: December Venue: Mumbai Venue: MMRDA Grounds, Bandra Curla Complex, Mumbai Website: www.win-india.com www.powderbulksolidsindia.com Website:
Metallurgy India 2016 13th DOORS WINDOWS EXPO Date:ZAK October 5-7,&2016 Date: 09th 11th December, 2016 Venue: Mumbai Venue: Pragati Maidan, New Delhi, India Website: www.metallurgy-india.com Website: www.zakgroup.com
Bauma Conexpo India Bauma Conexpo India Date: Dec 12-15, 2016 Date: December 12-15, 2016 Venue: Gurgaon Venue: Gurgaon Website: www.bcindia.com Website: www.bcindia.com
India Essen Welding & Cutting 2016 World of Concrete Date: October 5-7, 2017 2016 Date: 17th -20th Venue: Mumbai January 2017 Venue: Vegas Convention Center, Las Vegas, USA Website:Las www.india-essen-welding-cutting.com Website: www.informaexhibitions.com
1st Buildings India 2017 Expo 1st Buildings India 2017 Expo Date: 10-12 May 2017 Date: May 10-12 May 2017 Venue: Pragati Maidan, New Delhi Venue: Pragati Maidan, New Delhi
IMEX 2016 IMME 2016 10-12, 2016 Date: August Date: 16th-19th November 2016 Venue: New Delhi Venue: Park, Rajarhat, Kolkata, India Website:ECO www.imexonline.com Website: www.immeindia.in
3rd Smart Cities India 2017 Expo 3rd Smart Cities Date: 10-12 May India 2017 2017 Expo Date: May 10-12 May 2017 Venue: Pragati Maidan, New Delhi Venue: Pragati Maidan, New Delhi
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