September 02-08, 2013 1

VOLUME 2 l Issue No. 35 l September 02 - 08, 2013 l Price : Rs. 100An MMR, Braj Binani Group Publication

$10 trillion opportunity awaits Menasa

Amidst the U-, V- and W- shaped recovery and the doom predicted in leading economies, some lesser talked-about markets are quietly mending their ways out of the woods and are likely to exhibit exponential growth in days to come. With world shrunk into blocs like Brazil, Russia, India, China and South Africa (Brics), the European Union (EU), the Gulf Cooperation Council (GCC), there is now a new entrant waiting to script its success stories.

Commonly referred to as Menasa (Middle East, North Africa and South

Asia), this new emergence has become one of the world’s booming regions in the past couple of years.

As per a report by Frost & Sullivan, Menasa recorded a combined GDP of $8.3 trillion in 2012, achieving a growth rate of more than 3.5 per cent over the previous year. With sustained long term growth plans and anticipated revival of the global economy in the next two to three years, the combined GDP of Menasa is expected to reach $12.3 to $12.8 trillion by 2022-23.

Largely unknown to the regular

small and medium business, this area will now become the focus for growth.

Further, its report titled Mega Trends env i sages s ign i f i can t opportunities in Menasa across key sectors such as infrastructure development, power and water, real estate, oil and gas, manufacturing and healthcare by 2022-23.

Samita Khawar, Head of Growth Implementation Solutions, Frost & Sull ivan, Menasa, says, “The combination of numerous countries and lack of availability of relevant revival of the global economy in the

next two to three years, the combined GDP of Menasa is expected to reach $12.3 to 12.8 trillion by 2022-23.

W i th economic sup remacy orienting towards east in this post-credit crisis period, Construction Industry Review , in i ts Second Anniversary special, unlocks the potential holding regions like Menasa, China, and India.

information can leave companies with a daunting task of how to approach their expansion plans. While ‘how’ is the biggest question that is generally asked, a better starting point is ‘where’. The specificities of regions, countries, and even markets within countries mean that the entry strategy generally needs to be customized to the strategic needs of the client.”

Frost & Sul l ivan endorses a st ructured and ins ights-based evaluation of growth and expansion options, as the r ight approach f o r l e v e r a g i n g M e n a s a ’ s y e t untapped, $10 trillion cross-industry opportunity.

The Middle East, North Africa and South Asia has been one of the world’s booming regions in the past couple of years. Menasa recorded a combined GDP of $8.3 trillion in 2012, achieving a growth rate of more than 3.5 per cent over the previous year. With sustained long term growth plans and anticipated

2Anniversary Special

(Contd. on pg. 2)

2September 02-08, 2013COVER STORY

I n d i a m a r k e t s p r e s e n t a n interesting opportunity for investment, as it can absorb liquidity inflows on infrastructure projects which will have a meaningful GDP growth. Moreover, South-East Asian countries have a natural pool of both skilled and unskilled labour that can form the basis of investment interaction between capital-endowed nations in the Gulf and population-rich South Asia.

Common sense would suggest that a higher infrastructure growth in these countries will eventually have a positive impact on the GDP growth.

India -- reforms aiding growthThe Indian economy has been

marred by several domestic and global factors plunging GDP growth to 5 per cent in 2012-13 fiscal, which was a decade low. Low growth, coupled with high inflation, global economic slowdown and high fiscal deficit, has significantly impacted domestic industrial production, foreign inflow and overall market sentiment.

To coun te r t he s lowdown , government recently introduced several key reforms, such as permitting FDI in retail, aviation, insurance and broadcasting. The Reserve Bank of India (RBI) is also trying to improve liquidity in the economy by cautiously reviewing the key rates.

A new study by Global Construction Perspectives (GCP) and Oxford Economics finds that, going further, India will become the world’s third largest construction market by 2025, adding 11.5 million homes a year to become a $1 trillion a year market.

The GCP study also predicts that while India’s infrastructure market is expected to grow at around 8 per

cent, the fastest among its sector, India is unlikely to achieve its plan target of $1 trillion investment in infrastructure, given the shortage of financing. However, while factors like high commodity prices, inflation and currency volatility affect its short term growth prospects, the writers feel that in the medium to long term, once global financial volatility passes, India is poised for a construction boom.

The construction industry is a major contributor to the country’s GDP (8 per cent in FY12) and one of the largest employment generators currently employing around 33 million people. While the Indian economy grew by 5 per cent in FY13 as compared to 6.2 per cent in FY12, the construction industry grew by 5.9 per cent in FY13 against 5.6 per cent in FY12.

According to a PwC repor t prepared for the organizers of The Big 5 Construct India exhibition, India is expected to emerge as the world’s third largest construction market by 2020.

In the past decade, “the country has witnessed a tremendous housing boom over the span of five years, from 2012 to 2016, the real estate sector is expected to account for 43 per cent of the construction spend in India. This segment is forecast to achieve a CAGR of 13.6 per cent during this period. The PwC report estimates that the market for the real estate construction segment in India is likely to aggregate to approximately $380 billion over the five-year period, 2012 to 2016,” states Dushyant Singh, Associate Director-Strategy, PwC.

Funding mechanismThe construction sector, including

the residential & non-residential

buildings and infrastructure sector, is attracting both domestic (government funding, institutional funding) as well as foreign direct investment. Before the year 2000, the deployment of gross bank credit in the construction sector was declining, e.g. from 2.13 per cent in 1990 to 1.37 per cent in 2000. In order to increase the flow of institutional credit to the construction sector, it was declared as an industrial concern under the Industrial Development Bank of India Act in March 2000.

In the year 2010-11, around Rs

50,135 were lent by banks to the construction industry which was 1.4 per cent of the gross bank non-food credit disbursed during the year. While this step was in the right direction, it is necessary now to encourage banks and lending institutions to develop lending norms and special funding instruments that could address both the requirements of the construction industry as well as the concerns of the bankers.

China -- demand to grow 8.5 pc per year thru 2017

China’s expenditure on construction is estimated to increase 8.5 per cent per year in real terms through 2017. The ongoing industrialization and urbanization, rising levels of income, growing population, and the government’s thrust to the expansion and upgradation of the nation’s infrastructure will support healthy growth in construction spending.

However, growth is l ikely to moderate further from the 16 per cent annual gains witnessed during the 2007-2012 period, when gross fixed capital formation was boosted by the government’s stimulus programme to counter the global financial crisis in 2009.

In terms of macro perspective, although China’s domestic GDP reduced further to 7.9 per cent year-on-year in the fourth quarter, several key indicators improved during the last quarter of 2012. The HSBC China PMI for December 2012 stood at 51.5, the year high. Both the new order index and the new export index showed improvement, reflecting increased optimism among manufacturers. Former premier Wen Jiabao recently commented that economic growth in China had stabilised and that there was no need for excessive stimulus measures. This was seen by many as an indication that additional stimulus measures are unlikely in the near future.

According the a recent report by KPMG, China’s housing market stabilised in third quarter but started to rebound in November 2012, with most cities included in the 70 Large-and-Medium-Size Cities New Commodity Housing Price Index showing higher

vo lume register y-o-y growth. Developers grew more optimistic following the rebound in transaction activity in the second quarter of 2013 onwards and opted to speed up the launch of new projects and reduce discounts.

Strong demand for quality logistics facilities and rents increased in most cities in China in 2012. Space in Tianjin, Shenyang, Guangzhou, Chengdu and Chongqing remained particularly tight and rents in these markets recorded stronger growth. A circular issued by the government during the period to promote foreign trade is anticipated to create additional demand for quality logistics facilities.

While as per a recent report by the US-based RnRMarketResearch, construction expenditures in China are nearly equally split among residential buildings, non-residential buildings, and non-building structures. Each of these segments accounted for around one-third of the total construction market in 2012.

Non-building construction will see the fastest growth (in real terms) through 2017. Increases will benefit from state-led efforts to expand and upgrade the country’s transportation infrastructure, such as the “7918” highways network, subway systems in major cities, and several airports. Utilities construction will also contribute to non-building construction spending gains, particularly in fast growing urban areas, as the government continues to expand and improve access to such infrastructure as water supply, sewage treatment, rubbish disposal, and gas distribution. Further efforts to increase the country’s power generation capacity and improve electricity transmission networks will also drive spending on non-building construction.

Non-residential buildings to exhibit annual gains

Inflation-adjusted non-residential building construction expenditures are forecast to post the best annual gains through 2017. Growth will be led by strong advances in industrial building construction. Spending on residential

Flow of Bank Credit to Construction Sector (in Rs crore)

2006-07 2007-08 2008-09 2009-10 2010-11

Gross Bank Non-Food Credit w1801240 2204801 2601825 3040007 3667354

Bank Credit to Construction Industry 19997 27945 38505 44219 50135

Percentage share ( per cent) 1.1. 1.3 1.5 1.5 1.4

Source: Annual Reports, RBI

Flow of FDI in Construction Activities (including roads & highways)

2007-08 2008-09 2009-10 2010-11Cumulative

(April 2000 – Aug 2011)

In Rs crore 6989 8792 13469 4979 42,072

In USD million 1743 2028 2852 11039417 (6 per cent of total FDI inflows)

Source: DIPP, MoC&I

Indian construction industry estimates (Rs billion)

2012/13f 2013/14f 2014/15f 2015/16f 2016/17f Total

Construction Industry value 7,668 8,875 10,316 11,860 13,590 52,309

Infrastructure industry value as per cent of total construction

49 50 50 51 52 -

Infrastructure industry value 3,723 4,413 5,204 6,059 7,017 26,417

Residential and non-residential building industry value as per cent of total construction

52 50 50 49 48 -

Residential and non-residential building industry value

3,945 4,461 5,112 5,800 6,574 25,893

Sources: BMI forecasts, Census and Statistics Department / ILO

prices in December 2012. Sold Gross Floor Area (GFA)

of residential properties totalled 985 million square metres in China throughout 2012, up by approximately 2 per cent from 2011. Developers, nevertheless, remained cautious, with new construction and land purchase data still registering a fairly significant year-on-year decrease.

New office completions slowed in most cities in 3Q but rebounded slightly in 4Q12, and supply in key cities in the north and south remained limited. Demand in key markets generally weakened amid the unfavourable economic environment. However, demand for retail space remained robust, with international luxury brands and fast-fashion retailers actively seeking quality space in prime locations.

Retailers remain positive about long-term growth in domest ic consumption and are focusing their expansion efforts on the central and western regions of the country.

In the residential sector, most cities saw prices stabilise and transaction

September 02-08, 2013 3COVER STORY

buildings will be slightly less through 2017, with market gains primarily driven by continuing population migration from rural to urban areas and supported by rising personal income levels. Despite strong gains in housing construction over the last decade, living conditions remain poor for some residents due to uneven distribution of housing ownership in urban areas in China.

Central-East to remain largest regional market

The Central-East region, home to about one-third of the country’s total populat ion and economic output, supports the largest regional construction market and will account for the majority of total construction spending in China in 2017.

Construction expenditures in the Northwest region are expected to enjoy the fastest growth, benefiting f rom the government ’s “Great Western Development” strategy and rising personal incomes, which wil l result in relatively stronger increases in construction spending on infrastructure and manufacturing facilities and housing.

Indonesia -- higher infra spend to spur growth

Against a backdrop of weaker g loba l economic g rowth , the Indonesia’s economy in 2012 grew strongly by 6.2 per cent, buoyed mainly by domestic demand. Over the past eight years, the Indonesia’s economy has continued to grow solidly, averaging in excess of 6 per

cent, making Indonesia one of only a very few countries in the world to combine rapid economic growth with maintained stability.

This sustainable economic growth was underpinned by a favourable macroeconomic environment and stable financial system. Economic expansion in 2012 was boosted by the growing contribution of domestic demand, amid s lower expor ts performance due to weaker external demand. From the production side, nat ional economic growth was still driven by three main sectors, namely the manufacturing sector, the trade, hotels and restaurants sector as well as the transportation and communication sector.

The agricultural sector, along with the construction sector, also experienced surging growth in line with persistently strong domestic demand. Nevertheless, the mining and quarrying sector continued to report relatively marginal expansion as a consequence of slower global economic expansion.

In addition, past structural factors and policy responses as well as future policy directions will also affect the dynamics of the Indonesian economy going forward. Under these conditions, Indonesia’s economy in 2013 is expected to remain strong and grow within the range of 6.3 per cent - 6.8 per cent, as per a 2012 economic report by the Bank of Indonesia.

The Residential Property Price Index rallied 2.19 per cent in the second quarter of 2013 or 12.11 per cent year-on-year during the reporting period. The public demand for houses has led to an 18.08 per cent (qtq) surge in residential property sales volume during the second quarter of 2013 for all types of houses.

Med ium and sma l l houses experienced the most dramatic upsurge in sales volume at 23.47 per

cent and 23.43 per cent respectively. The performance of the property market is reflected by a significant increase in the allocation of mortgage loans and other property credit in the reporting quarter.

Favorable performance is further corroborated from the survey results by the Real Sector Statistics Division of the Indonesian government that confirm mortgage loans are the most dominant source of financing used by the consumers while purchasing property, with average rates between 9 per cent and 12 per cent.

Market outlookDomestic demand is predicted to

remain as the main contributor to the economic growth, being consumption and investment are expected to record higher growths. One particular factor which is envisaged to contribute positively to the domestic economy is the activity following the preparation and organization of the 2014 general elections.

Investment in 2013 is expected to post a strong growth in the range of 10.2 per cent-10.7 per cent, higher than the previous year in line with strengthening domestic household consumption and the prospect of stronger export performance.

In addition, this condition is further supported by higher government capital expenditure, improved investor optimism and encouraging domestic business climate. Thus, the ratio of investment to GDP is expected to continue its upward trend and exceed that of the previous year.

In the 2013 state budget, the government has budgeted capital expenditure of Rp184.4 trillion, where the highest allocation reserved for infrastructure. This higher spending allocation is intended to further support de-bottlenecking efforts as well as improve connectivity between regions, food security, energy security, and public welfare.

Provis ions for infrastructure development in the 2013 state budget includes roads, ports, provision for faci l i t ies and infrastructure of river transport, lake transport a n d c r o s s i n g s , c o n s t r u c t i o n and rehabi l i ta t ion of a i rpor ts , the construction of new railway lines, construction of terminals, road transport, the construction of wharf crossing facilities, as well as development of the construction and management of fishing ports. In addit ion, to further faci l i tate infrastructure development, the government also allocated funds to increase power capacity and expand the transmission network across the regions.

Furthermore, the government plans to increase highway capacity across Sumatra, Java, Bali, Borneo, Sulawesi, West Nusa Tenggara, East Nusa Tenggara and Papua.

The government also initiated a number of policies to accelerate infrastructure development including the issuance of procurement of goods/services and the procedure for land acquisition for development and public interest.

Malaysia – 10th plan to drive growth

Malaysian construction industry is set for great development with the ongoing implementation of the 10th Malaysia Plan. Given the development allocations and facilitation funds, the industry is set to benefit from the abundant opportunities that will arise from the plan.

These opportunities including high impact projects will create multiplier effects that will enhance the demand and domestic growth for the entire economy especially the construction sector. Niche sectors such as the development of green townships and sustainable living are also areas which Malaysia is pursuing.

(Contd. on pg. 37)

4September 02-08, 2013INFRASTRUCTURE

The Metro-Link Express for Gandhinagar & Ahmedabad (Mega) is committed to deliver world-class state-of-the-art technology and most cost-efficient Metro within the shortest time span possible in the country. Sanjay Gupta, Executive Chairman, Mega, expands upon project details in this interaction with Remona Divekar. Excerpts:

The Me t ro ra i l ne two rk o f approximately 87.26 km has been approved by the Gujarat government. Predominantly the network is planned on an elevated corridor running in the central median of the RoW.

Out of total network length, approximately 27 km of the section is an underground section serving the old city area of Ahmedabad. The network will serve at least 5.7 million daily ridership by the year 2041 when the population of the region will cross more than 12 million. The corridor traversing within Ahmedabad city has been proposed as phase-1, while the corridor connecting to Gandhinagar will be developed under phase-2.

Phase-1 of Metro al ignment consists of three lines with total length of 55.8 km and 38 stations. From total length, approximate 48 per cent stretch is underground. This phase provides connectivity in the Ahmedabad region. It connects West and East areas of the city as well as North and South area.

Phase–2 consists of 4 l ines admeasuring 31.48 km length with 18 stations. All lines proposed under phase–2 are elevated. This line connects state capital Gandhinagar with Ahmedabad city. This line connects to major hubs in the Gandhinagar like Akshardham, Indroda Nature Park, Sachivalaya, major administrative buildings etc.

What is the vision behind the Ahmedabad-Gandhinagar Metro? When was the SPV MEGA floated for the project?

The idea of initiating the Metro rail project in Ahmedabad was adopted in May 2009, which resulted in the formation of a SPV –Metro Link Express for Gandhinagar & Ahmedabad (Mega) Company Ltd. in February 2010. However, the route was finally approved by the state government in September 2012.

The idea was born out of the vision to provide safe, fast and eco-friendly rail based mass transit services to the public at affordable rates while simultaneously catalysing dense and orderly urban growth.

The project supports Gujarat government’s vision of continuing the journey as one of India’s fastest growing states. This in turn will require urban transportation infrastructure which can cater to future population growth in the Ahmedabad-Gandhinagar region.

What is the current status of the project? Tell us about the progression of work done so far in general engineering consultancy and civil works? Which companies were awarded this contract and what is the scope of work allotted to them?

Prel iminary surveys such as topographical survey, soil investigation

‘Mega Metro, a model project for India, not just Gujarat’

survey, detection of underground utility completed. Traffic demand assessment on the entire network has been completed.

Monopile (bilateral direction and vertical direction) test for finalizing load for substructure has been conducted. Preliminary design for civil (substructure/superstructure), engineering alignment design, preliminary train operation plan, power load calculation, etc are completed. Detailed design of depot and protecting structure has also been completed.

Utility shifting work on the full alignment, development of casting yard is in progress Core infrastructure works will begin in fourth quarter of year 2013. Appointment of general consultant & project management consultant is underway for which RFP is issued and under finalization. Apart from this Environment Impact Assessment (EIA) study, sustainability study, transit oriented development and multi modal integration study are underway.

What is the total investment in the project and how will it be funded?

The total cost of the project is estimated at Rs 22,000 crore. The unique feature of the project funding is a low debt equity ratio of 40:60 against the conventional debt equity ratio of 70: 30. The Gujarat government will contribute the equity of 60 % while the balance 40 % would be raised as debt.

The government of Gujarat has already infused Rs 550 crore as equity till March 31, 2013 in Mega and has allotted a further Rs 550 crore for the financial year 2013-14 in the state Budget. Further allocations will be made as and when required.

Further, the length of the platforms will also reduce which will again result in lower capital costs. The wider coaches wi l l a lso mean greater passenger convenience and comfort.

Give us an estimated cost, project parameters and alignment details, keeping in view the safety aspects, access to all, easy circulation area, automatic fare and parking facilities?

The total estimated cost of the project is Rs 22,000 crore. The project has been undertaken as one single project. It is only for construct ion convenience and efficient management that the project would be taken up in phases.

Mega has a clear vision – to provide safe, fast and eco-friendly rail based mass transit services to the public for connecting important points in Ahmedabad and Gandhinagar .The project will be of 88 km connecting all the important points of Ahmedabad like Kalupur Railway station, Gita Mandir Bus station, Civil hospital, Paldi, University, Airport and reaching to Gandhinagar for connecting GIFT city, Sachivalaya and Akshardam.

The project is being designed with the state of the art technology like CBTC for signaling, 3rd Rail 1500 V DC for traction, wider body coach and broad gauge to carry maximum passengers.

Give us the phase wise design and structural elements planned for the metro? What state of art technology will be used here? Also, phase wise what is the estimated time of completion?

The project is being executed on an EPC basis with Mega itself functioning as the EPC contractor and going forward it will be the operations and maintenance contractor too. Also, most of the project design, planning and concept has been developed in–house.

The company has been recently a w a r d e d t h e I S O - 9 0 0 1 : 2 0 0 8 certification for its efforts by Stancert Assessors (P) LTD. Mega is now planning to leverage this certificate and its expertise by bidding for consultancy services for metro rail projects across the globe. This will also open a fresh revenue stream for the company enabling it to break even faster.

The project is being scheduled in two phases with the first phase comprising 56.32 km with elevated corridor and underground section. Line 2 being commissioned by October 2018 while the second phase of comprising 31.71 kilometers with elevated corridor and being commissioned by October 2024.

How will the project benefit the people of Ahmedbad-Gandhinagar? In what way will metro rail project promote integration with AMTS, BRTS, Railways and other modes of public transit system?

At present, publ ic t ransport accounts for only a small part of the transport used by the people in the region. Only one million in a population of six million people use public transport. This region is

The project is being scheduled in two phases with the first phase comprising 56.32 km with elevated corridor and underground section while the second phase of comprising 31.71 km with elevated corridor.

For the safety of the passengers, Mega will install safety glass panels on the platform (platform screen door/gates). This will prevent accidental falls off the platform onto the track area because of restricted access to the tracks and tunnels area.

Platform screen door will improve climate control within the station and also improve the sound quality of the platform announcements.

How do you view this metro project in comparison to the other metros that are constructed, planned in different cities of India? What striking difference do you have in this project? Do sustainable eco-friendly factors play a key role? If yes what are they?

We have drawn several key learnings from our observation of other metro rail projects. The first key learning is that no two metros are similar. It is all about customization. So, one cannot look at readymade models. The project should clearly evolve based on the principle of customer centricity.

The Mega Metro rail project would be a pioneering project of its kind in India due to the adoption of latest technology. Apart from driverless trains another, wide coaches and the adoption of broad gauge a key feature of this project is the use of monopile structures predominantly.

Another important feature is 1500 V DC Third Rail traction system. Also the project is eco-friendly as there will be no emissions and thus the company can earn carbon credits. Also the project is eco-friendly as there wil l be no emissions and thus the company can earn carbon credits.

transport. The metro expects to carry 2.16 million people by 2021 and five million people by 2041 on a daily basis.

Thanks to the latest technology and design passengers are expected to have a very comfortable and convenient journey. The project is also expected to generate several revenue opportunities for the project itself and state government which in turn will pave the way for further development.

Over a period of time, the metro will integrate seamlessly with AMTS and BRTS with a single ticket being issued. Mega will provide high speed Wi-Fi internet services on the go and thus enable commuters to connect with the world on the go.

Rolling stock is one of the longest lead time items. What is the USP of this material and in which major construction work for metro project would it be used?

Our coaches are a distinctive feature of the Metro project. These will be wide bodied coaches of 3.6 m width and will run on broad gauge 1,676mm. The wide sized coaches will result in lower overall capital costs as fewer coaches can carry more people.

expected to grow rapidly and this will need to be supported by a public and modern transportation network.

The route has been planned in such a way that it taps the majority of the remaining five million populations. The development of this project is expected to lead to sharp increase in the share of traffic for public

Typical Metro station

Mah

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a M

andi

r

September 02-08, 2013 5pOwER

Chinese investments play large role in SE Asia hydroelectric growth

China has emerged as a key player in both financing and building the hydroelectric power infrastructure in Southeast Asia. China invested more than $6.1 billion between 2006 and 2011 in financing 2,729 megawatts (mw) of capacity additions.

Between 2006 and 2011, Chinese investors—such as the state-owned enterprises Export Import Bank of China and China Development Bank—financed 46 per cent of all hydroelectricity capacity additions in Cambodia, Laos, and Myanmar and developed previously untapped hydroelectric resources in countries bordering the Mekong and Irrawaddy river basins.

This investment represented 6 per cent of the total global hydroelectric power capacity currently under construction and 10 per cent of the planned capacity additions outside of Brazil, Russia, India, and China.

Hydroelectric resourcesSoutheast Asia has one of the

world’s fastest-growing regional economies and is also home to some of the world’s largest untapped hydroelectric resources. Through 2018, the International Monetary Fund expects the relatively small economies of Cambodia, Laos, and Myanmar will see rapid economic growth within the region and will meet the increased energy demand with electricity from the new hydroelectric capacity.

The combined percentage of hydroelectric generation relative to total generation in these three countries is expected to rise to 96 per cent in 2030 from 80 per cent currently, according to data from the Association of Southeast Asian Nations (Asean).

Much of the future electricity generated from the Chinese-financed and -constructed hydroelectr ic facilities in neighbouring Myanmar and Laos is expected to be exported to China’s rapidly growing southern regions. Cambodia does not share a border with China.

Details on hydroelectric projects and funding in each of the three countries follow:

Cambodia According to Asean, hydroelectric

power is expected to account for 77 per cent of Cambodia’s total electric generating capacity by 2030. By contrast, hydroelectric power accounted for less than 4 per cent of Cambodia’s 386 mw of electric generating capacity in 2007.

Much of Cambodia’s hydroelectric power expansion to date was financed by China. In December 2010, Sinohydro—a Chinese state-owned hydropower engineering and construction firm—completed the construction of the 184 mw Kamchay Dam project at a cost of $280 million with financing from the Export Import Bank of China.

Separately, at a cost of $1 billion, China is sponsoring construction of Cambodia’s Stung Tatay and Stung Russey dams, which upon completion will be among Cambodia’s largest hydroelectric power projects. Cambodia plans to build 10 dams between 2010 and 2019, adding 2,045 mw of capacity. Chinese entities are providing financing for six of these dams.

Laos Almost all of Laos’s 731 mw of

electric generating capacity was water-based as of 2007, and all future capacity additions are expected to be hydroelectric. China’s investment capital is expected to add more than 2,000 mw of capacity to the Laotian grid.

Added capacity has turned Laos into a major regional exporter of electricity, much of which goes to China. In 2011, Laos exported almost 678 million kWh, or nearly 32 per cent of its total generation, and electricity exports accounted for about one third of its total exports.

Myanmar About 98 per cent of Myanmar’s

electricity needs are expected to be generated by hydroelectric plants in 2030; in 2007 this figure was about 50 per cent. A centre piece of China’s investment in Myanmar’s hydroelectric generating capacity is the 6,000 mw Myistone facility.

Estimated to cost $3.6 billion, Myistone was to be one of the largest hydroelectric plants ever built. Even though the Myistone Dam project remains on hold, construction has begun on 13,200 mw of future hydroelectricity capacity in Myanmar’s Irrawaddy River basin, financed by both Chinese and Thai investors. The electricity produced by these dams is intended for export to China and Thailand.

E I A r e c e n t l y r e l e a s e d i t s International Energy Outlook (IEO) 2013, which includes projections of electricity generation and capacity worldwide through the year 2035.

(Source: The Association of Southeast Asian Nations)

6September 02-08, 2013CONSTRUCTION CHEMICALS

Silica fume has been used as a mineral admixture to improve concrete properties since the 1950s. Commercial development of the material began in the 1970s with Elkem Microsilica being a registered trademark belonging to Elkem Silicon Materials of Norway.

The term ‘microsilica’ is commonly used in many countries to describe silica fume. Silica fume imparts a range of important benefits to concrete. It is extensively used in construction, such that it is now estimated that more than 10 million cubic metres of high performance silica fume concrete are produced worldwide every year.

International Standards for silica fume include ASTM C 1240 published by ASTM International and EN 13263 published by European Committee for Standardization and in India it is IS 15388:200

Production of silica fume Microsilica is an industrial by-

product , produced dur ing the manufacture of metallurgical silicon. Around 350-500kg of silica fume arises for every ton of metallurgical silicon produced.

Silica fume can be defined as ultra-fine particles of amorphous silicon dioxide. Each particle is spherical,

Silica fume for high performance concrete

sub-micron in size and with SiO content in the range 85-99 per cent (Figure 1). The ultra-fine particles improve particle packing and produce a highly pozzolanic reaction in the concrete mixture, leading to:

Reduced permeability, therefore reduced ingress of chloride & other harmful agents and resulting in greater protection for reinforcing s tee l , especia l ly in cr i t ica l infrastructure e.g. marine structures; Higher strength; Higher abrasion & erosion resistance.

The benefits of silica fume in high performance concrete are summarised in Table 1.

For example, Bandra-Worl i Sea Link Bridge in Mumbai used high performance silica fume concrete.

The required strength and marine durability were achieved using M50 grade (with 10 per cent silica fume) for the piles and M60 silica fume concrete for the pile caps, piers and precast segments.

Severe chloride environments, such as marine structures and projects in the Middle East, utilise silica fume for maximum service life. In the Middle East, it is common for a maximum chloride permeability of 1,000 coulombs to be specified (ASTM C1202-09 method).

Typical silica fume concrete mixtures supplied to these projects achieve around 500 coulomb or less.

Silica fume can be defined as ultra-fine

particles of amorphous silicon dioxide

Figure 1 Silica fume particles are spherical and sub-micron sizedTable 1 Features and benefits of silica fume

Features of silica fume

Reaction in concrete

Key concrete benefits

Commercialpossibilities

High SiO2 content (>85%)

Extremely efficient pozzolanic reaction (increased CSH and reduced Ca(OH)2), improved transition zone between aggregate and paste

Optimal high compressive and flexural strength

Reduced corrosion of steel reinforcement

Greater abrasion and chemical resistance

Reduced segregation and bleed

Reduced sprayed concrete rebound

Reduce size and mass of elements with higher strength concrete

Longer service life for marine structures

Longer service life for industrial floors

Easier pumping for tall buildings

Economical sprayed concrete

Glassy (amorphous) spherical shape

Lubricating, ball-bearing effect

Ultra-small particle size (less than 1 micron)

Maximum particle packing, reduced voids and permeability

Handling and mixing silica fume

During production, silica fume initially takes the form of an ultra-fine (average particle size 0.15 micron) dry powder and has very low bulk density. To aid handling, the silica

fume powder is usually subjected to a ‘densification’ process, thereby increasing the bulk density from around 300 to 600kg/m.

In this densified form, the ultra-fine silica fume particles are agglomerated loosely together. The product can

then be delivered in bulk or bags to the concrete plant. During mixing at the concrete plant, it is important to ensure the densified silica fume agglomerates are broken down, reverting to their primary, ultra-fine condition with full dispersion throughout the concrete mixture.

This is achieved through correct batching sequence, efficient mixing plant and adequate mixing time. Due to its high surface area (typically ca. 20,000m/kg), silica fume concrete requires the use of superplasticiser to achieve appropriate water/binder ratio.

Silica fume tends to reduce or eliminate bleed water; it is imperative that a suitable curing regime must always be enforced at the construction site.

Current uses of silica fume concrete

Protection from corrosion for steel reinforcement

Concrete structures requiring strength and durability in a high chlor ide environment, such as harbours and marine bridges, are a major application for silica fume.

September 02-08, 2013 7CONSTRUCTION CHEMICALS

Ultra-high strength concrete Ultra-high strength concrete

(UHSC) technology has been extensively researched by the academic community. There is growing awareness of the commercial value of these higher performance concretes.

A typical UHSC mixture could have a water/binder ratio around 0.15-0.20 and a 20 per cent silica fume dosage (of total binder mass). The silica fume contributes towards the high strength through (a) highly efficient pozzolanic reaction and (b) optimized particle packing.

To help design a UHSC mixture with optimal particle packing, computer software such as those

based on the Andreassen model can be used. Recent research in Norway has demonstrated that UHSC can successfully be made using locally available, common materials.

Understanding the synergy between silica fume and super plasticizer in the UHSC is critical to achieve the very low water/binder ratio required by UHSC. This is an area of research now being progressed by Elkem.

Self-compacting concrete Self-compacting concrete (SCC)

mixes can be sensitive to fluctuations in material properties and batching accuracy, potentially leading to issues of segregation or variations in consistence. This can make large-scale supply of SCC from ready-

mixed plants more diff icult and onerous.

To overcome this issue and improve the robustness of self-compacting concrete, a relatively low dose of silica fume (for example, 5 per cent silica fume by weight of total cementitious content) is effective.

Versatile, reliable Since first becoming commercially

available in 1970s, silica fume has steadily established itself as a versatile and reliable material. It is being used to produce high performance concrete in a wide range of projects around the world.

Higher performance concrete can play an increasingly significant role in improving the sustainability of concrete construction, by improving the durability and service life of infrastructure and by enabl ing structural design improvements such as reduced column sizes.

Surendra Sharma Dy-General Manager (Construction), Elkem

South Asia Pvt Ltd.

Table 2: Mix Design and Results, Tehri Dam Laboratory Trials

M30 M50 M60 M70

Cement, kg/m3 317 340 365 380

Silica fume, kg/m3 0 10% 10% 10%

Aggregates, kg/m3 1900 1934 1909 1890

Water, kg/m3 143 142 140 130

w/b ratio 0.45 0.38 0.35 0.31

Strength 3 days 20.89 29.33 43.29 51.16

Strength 7 days 28.13 43.82 56.49 60.85

Strength 28 days 35.73 56.18 68.23 75.4

% abrasion loss, 72 hrs 6.26 3.06 2.88 2.75

Abrasion resistance Applications requiring exceptionally

high abrasion resistance, such as heavy duty industrial floors, coastal sea defences and military pavements specify high performance silica fume concrete. For example, a number of hydroelectric dam structures in India, e.g. Chamera, Salal, and Tehri, have utilised high performance silica fume concrete to reduce erosion and abrasion damage in the spillways and stilling basins.

Silica fume will increase the abrasion resistance of concrete through increased strength of the matr ix and the improved bond between matrix and aggregates.

Tehri dam, constructed on the Bhagirathi river in North India, is a 2000 mw hydroelectric power plant with an earth and rock fill dam and several chute and shaft spillways. The water velocity in the spillways has been recorded up to 45-50m/s with circular motion especially at the junction of the vertical and horizontal shafts of the shaft spillway, creating high risk of having severe cavitation damage along the lining of the spillway.

A large amount of fine sand and silt is carried in the river, posing a high risk for abrasion-erosion damage to the hydraulic structure.

For the Tehr i dam pro jec t , laboratory trials were conducted using various concrete grades, with and without silica fume. The abrasion-resistance test method used was ASTM C 1138.

This method uses steel balls in water stirred by paddles at 1200 rpm to simulate the abrasive action of waterborne particles such as silt, sand, gravel, and boulders. The results of the laboratory trials are shown in Table 2.

A high performance M70 concrete mix with 10 per cent silica fume showed least abrasion loss and was selected for use in the construction project.

High-rise buildings and pumping

Sil ica fume is routinely used in the construction of the world’s tallest buildings. Classic examples include the Burj Khalifa in Dubai and the Petronas Twin Towers in Kuala Lumpur.

This type of structure requires a high performance concrete, which is typically based on a ternary blend of binder. The aim of a ‘triple blend’ is to economically optimise strength, durability and placement.

For example, the Guangzhou International Finance Center, designed by Wilkinson Eyre and completed in 2010 is 432 m tall with 103 floors and for this project a ternary blend silica fume concrete mix was used to improve pumpability and achieve high strength.

Shotcrete and tunnels Silica fume is also specified for

tunnelling projects, both for sprayed concrete and precast segments. For sprayed concrete, silica fume improves both the fresh rheology and the long-term durability of the concrete. In precast, it is used to increase both strength and durability.

The structure is a column-in-column design, with a reinforced concrete core tube and an exterior frame of concrete filled steel columns. Some 70,000 m of high strength concrete was supplied, including C90 pumped to 168m height and C80 pumped to 410m. Details of the C80 concrete mixture are shown in Table 4.

Table 4 C80 mix design, Guangzhou International Finance Center

P11 42.5 R (GB175- 2007 ‘Common Portland Cement’)

GGBS Silica fume SuperplasticiserWater/ binder ratio

Consistence

420kg/m3 142kg/m3 20kg/m3 PCE 0.26 220-260mm

8September 02-08, 2013CONSTRUCTION CHEMICALS

The usage o f s tee l i n t he construction industry has been facing headwinds especially in light

New trends in protective coatingof corrosion issues associated with its adoption. However, as technology progresses, the loss of assets attributed to corrosion is on the decline.

Of course, with steel comes corrosion and with corrosion comes coating systems. Coatings (also read paint) companies have been researching to develop better and economical molecules to deliver a long performance experiences to the end user. Fol lowing are some of the commercially available, recent developments in the coating space:

Eco-friendly and efficient innovative

technologies promise cleaner, safer and

durable coating systems and advancements

in protection of structural steel

Thin film intumescent fire protection coatings:

Many, if not most, renowned iconic buildings have utilized high strength steel to provide the structural frame and a good foundation to the structure.

The usage of steel provides an architect or interior designer an opportunity to express design creativity and to provide enhanced functional utilities for the developer. Both internal and external steel can feature in the expression of structural form, and can provide an optimized building layout, where the developer can maximize return on the investment in terms of increased usable floor space.

In addition, speed of construction and reduced frame weight make steel a very attractive proposition to all the stakeholders. Finally, steel offers the opportunity to meet the challenges of sustainable development as it is 100 per cent recyclable and thus the steel framed buildings can be regarded as ‘carbon friendly’.

In order to enable the structural response to realize the various benef i ts of the structural steel frame; it is necessary to ensure that it will remain stable in the event of fire. It is also often necessary to provide additional passive fire protection (PFP) to some, or all, of the individual members that make up the steel frame. Unfortunately, unprotected steel can perform poorly in fully developed-post flashover compartment fires, which can lead to full or partial collapse.

The devastating effects of the failure of structural steel frames have been all too evident in the recent years, like in the case of collapse of the serious fire in the Torre Windsor Tower in Madrid. There is a clear focus on fire safety design in tall buildings, and reports published by the National Institute of Standards and Technology (NIST) and the Federal Emergency Management Agency (FEMA) on the disaster has revealed the following:

Improved structural integrity; development of new tools for fire resistant design; enhanced and improved spray applied structural fire protection systems; improved active f i re protection improved building evacuation and emergency response.

T h i n f i l m i n t u m es c e n t f i r e protection coatings are applied to parts of a building that are covered in structural steel. This coating ensures maximum protection (usually up to 2 hours) and enables a high quality finish to be achieved, akin to conventional decorative paint systems.

They also provide high corrosion protect ion as wel l as enhance aesthetics and sometimes, ensure increased life of the building. The protective function of the coating gets activated during a fire breakout, hence the protection is latent and always present.

These coatings are tested and certified by leading agencies in the fire protection space to ensure safety in operation. Airports and metro rails have already commenced using this technology and the results are conspicuous.

Polysiloxane technology: Another common method of

protecting steel structures against corrosion, in the recent years, has traditionally been a three-coat system comprised of a zinc-rich primer, an epoxy mid-coat, and an acrylic polyurethane topcoat.

The zinc-rich primer provides corrosion resistance; the epoxy enhances the corrosion resistance and provides chemical resistance; the polyurethane protects the UV-sensitive epoxy and provides

September 02-08, 2013 9CONSTRUCTION CHEMICALS

protection against harsh weather conditions.

Al though this approach has worked well for decades, however, several factors can shift the criteria for selection of the right coating system for projects. These factors include: Commoditization (or reduction in the quality) of polyurethane technology, increased labor costs, greater emphasis on environmental (VOCs) and health (isocyanate exposure) concerns.

Competitive pressure tends to squeeze value from established technologies and in a bid to secure increased market share, vendors resort to reducing price. In an effort to reduce the cost of polyurethanes, fo rmu la to rs have eng inee red coatings, which some feel has sacrificed performance in terms of color and gloss retention.

While these commercial grade polyurethanes exhibit good initial results, but the performance drops off quickly. In the strictest sense, polysiloxanes (commonly known as silicones) are polymer comprised of alternating silicon and oxygen bonds with organic substituents attached directly to the silicon atom.

Polysiloxane Coatings are much more resistant to the degradation mechan isms due to the h igh performance nature or attributes of the Polysiloxane backbone. The SI—O bond is stronger (452 KJ mol-1) than the C—C bond (350 KJ mol-1) in Organic Coatings making it more heat and UV resistant. As it is already oxidized; Polysiloxanes are resistant to atmospheric oxygen and most oxidiz ing chemicals. Consequently, Polysiloxane Coatings are more durable (resistant to weather condi t ions) than Polyurethane Coatings and will retain gloss and color for a much longer period of time.

While cost per litre of polysiloxane-hybrids may be higher than that of a traditional urethane, the performance of polysiloxanes reduces the overall project cost by allowing formulators to recommend their use as two-coat systems (zinc-rich primer and polysiloxane topcoat), rather than the traditional three-coat systems.

Not only does the potential exist to reduce labor costs by a third, but less paint is applied to the surface thereby reducing material usage. Beyond cost reduction, the ability to use less paint has the added benefit of decreasing solvent emissions and overspray into the environment. Regardless of scale, ownership, and profile, all painting projects need now be considered beyond the immediacy of the task.

The coating finish is not only decorative but also protects the substrate against corrosion and chemical attack. This maintains the utility and safety of the investment for years to come. Less durable coatings tend to deteriorate, therefore they must be removed after a certain period of time and the substrate must be repainted.

This incurs not only labor and material costs, but also the disposal costs for the old paint coating. And with each repainting, resources are expended, chemicals are released into the environment, and workers are exposed to substances, including isocyanates.

Wh i l e mos t app l i ca to r s o f polyurethane coatings take the necessary precautions to ensure against exposure to isocyanates, concerns continue to arise. Health effects of isocyanate exposure include irritation of skin and mucous membranes, chest tightness, and difficulty in breathing.

Isocyanates include compounds c lass i f ied as potent ia l human carcinogens and are also known to cause cancer in animals. The main

effects of hazardous exposures are occupational asthma and other lung problems, as well as irritation of the eyes, nose, throat, and skin. The use of polysiloxane-hybrid coatings eliminates these concerns.

The current business challenges will only lead to more eco-friendly and efficient innovative technologies promising cleaner, safer and durable coating systems in future.

premraj Nair Market Manager, Protective Coatings, Akzo Nobel India

10September 02-08, 2013CONSTRUCTION CHEMICALS

Construction chemical market vis-à-vis CCMA to drive growth

Today is the age of fast track construction in India. Many major construct ion works have been conceived of and built over the last few years in India and the use of construction chemicals has been a vital part of these projects.

The construction of both residential/commercial and infrastructural projects has seen an immense growth spurt. Keeping this growth in perspective, much more quality, speed, economy and durability is demanded of construction. These quali t ies can only be achieved by efficient use of construction chemicals.

Even though the economy does seem like it is slowing down, construction continues on. This keeps the construction chemical industry growth drive in a positive perspective. The key objectives for our association will be to promote the growth of the construction chemicals industry, by raising awareness and quality standards and to be a representative body fo r communicat ing w i th government, chambers of commerce regulatory bodies and other forums, local and international.

Sharp rise in revenueWith the holistic approach the

Construction Chemical Manufacturer’s Association (CCMA) is planning, the industry is confident of growing from present revenue of about Rs 2000 crore to Rs 5000 crore in next few years. This is absolutely possible considering the large gap in demand and supply. With the focus on durability, sustainability, green practices and mitigating life cycle cost of buildings and infrastructure Construction chemicals can play

CCMA objectives The long-term objective of CCMA in

general is to increase the awareness in the end users about the correct usage of construction chemicals. We believe this will help us increase the treatment ratio of construction chemicals in concrete construction. Another objective of CCMA is to create trust in end users by creating standardization and transparency.

It is with this view that the industry has come together to spread the awareness. From humble beginnings of CCMA, today we have over 40 members who have an interest in creating a larger awareness of the industry, our technology and application potential. We are firmly on track to take this initiative to the next level, training programs would be held all over India for Applicators because Application is a very important aspect of the very success of waterproofing and repair systems.

Last ly we plan to establ ish just and equitable standards and principles in construction chemicals manufacture, trade and commerce and to regulate the conduct and practice of construction chemicals trade and manufacture.

Road ahead With our brand of C3 seminars

(held in Mumbai and New Delhi), we focused on the cause of technical awareness. The participants were end users, specifiers, government decision makers, etc.

These seminars also focus on problems faced by decision makers to specify and use these products wi th conf idence. In ternat ional speakers were invited who could instill confidence in our local civil engineering fraternity about benefits of usage of construction chemicals.

With this development, CCMA is set to become the voice of the construction chemicals industry. The success of our seminar series is a good indication that the interest in correct usage of construction chemicals is fast gaining ground due to the benefits in speed, durability and life-cycle costs it provides

Handbook plannedFurthering the cause for technical

development, a handbook is planned on the correct usage of construction

chemicals in collaboration with the Indian Concrete Institute. Attempts are already on way to introduce technical topics in the academic syllabi.

Training programmes are in advance stages of design. These roving seminars will be taken to rural areas as well as engineering colleges. Another initiative is to open up local chapters all over India. A seminar was planned in Ahmedabad in June 2012. Two more seminars are in advanced state of planning, one involving Dry-mix Mortars and the other involving the

stakeholders in the construction chemicals industry. A further

idea was to get a marking on construction chemicals to increase the confidence of the end-user.

Flagging off the initiative to bring this awareness to smaller cities, CCMA

flagged off its first regional seminar titled C3R at the

Grand Bhagwati Seasons Hotel, Rajkot, Gujarat on August

9, 2013. The theme of the seminar was ‘Methods and Practices on the use of Construction Chemicals.’ This initiative will be furthered to other cities such as Nagpur, Jaipur, etc. in coming months.

In a very short amount of time BIS has agreed that CCMA will be on key IS Code committees to take view point of expert CCMA members in the formulation of codes. With this holistic approach, the industry and awareness about is confident of growing.

Creating awarenessThe focus and know ledge

dissemination planned is all round and not limited to infra-projects alone. Finally as awareness increases our industry as a whole would grow. So all in all with creating awareness as base function, all possible regions across India and all segments of construction are being explored in our bid to increase durability, improve construction, speed up construction as well as grow our industry.

The construct ion chemicals industry has come up to age in our country. Overall in the organized sector the quality of construction chemicals is quite at par with international counterparts. All system like QA/QC, ISO 9000, etc are in place.

The entry of multinationals in this field with direct access to international technology has raised the bar of quality. This is to be met by local manufacturers. Be it imports or locally produced materials, the focus of purchasing or specifying construction chemicals should be solely on basis of performance.

If we can get a better performing material manufactured in India, it will be a big benefit to the Indian Industry as a whole. This benefit will also depend on government accepting construction chemicals as recognized industry; back us with incentives and rationalization of government taxes, duties and levies.

So all in al l our CCMA team effort and the effect it had in raising awareness about our industry does make us happy. It is the first successful step to a better future.

Samir SurlakerPresident, Construction Chemical Manufacturer’s Association

an important role in overall development of construction.

E s s e n t i a l l y c o n s t r u c t i o n chemicals are the l i n k b e t w e e n t h e chemica l i ndus t r y and the construction industry. By applying chemistry, we facil i tate solutions for the construction industry. We play a vital role in improving the concrete, waterproofing

and protecting its durability and also rehabilitating concrete, when it is distressed. So all in all, as far as concrete construction goes, construction chemicals will always have a key role to play.

The growth in the construction i n d u s t r y, c o m b i n e d w i t h t h e increasing demand for faster and safer construction, will propel the growth for our construction chemicals industry.

September 02-08, 2013 11CONSTRUCTION CHEMICALS

How to waterproof bathroommigration and leaching of the surface and unattended algae and fungus growth on the surface due to prolonged dampness and poor ventilation.

Leakage at pipe penetration and joints: Unplanned plumbing work creates gaps left at the junction and also when no proper protection is taken around the concealed and embedded pipes, water can seep through causing severe damage.

Leakage through floor traps: Because of improper laying of floor trap along the slope and insufficient protection at the corner rounds or poor application of membrane around pipes, water can seep through the joints.

Waterproofing issues on wet areas, especially

bathrooms

Today in modern bui ld ings, bathrooms are not just the spaces for freshening up, but are more visualized as personal spaces to get refreshed and also rejuvenated and as a matter of fact, a substantial amount of time and investment is put in to make-over or build bathrooms as per individual’s choice.

But the whole visualization gets disturbed when such bathrooms look damp and get frequently exposed to water penetration through walls, window joints, floors etc. Failure to waterproof bathroom not only hampers the look of your flat but also it could lead to major problems. Though wet areas occupy less than 10 per cent of the gross floor area, the annual maintenance cost for such bathrooms area can range from 35 percent to 50 per cent of the total maintenance cost depending on the type of facility.

Important parameterNormal ly the mater ia ls and

components used in bathroom to make its floor, wall, architectural finishes etc. including service pipes and sanitary fittings are susceptible to natural movement and as a result, the materials made of clay and tiles could increase in size affecting the joints and causing the tiles to shift.

This results into the leakages and dampness on the walls. So, waterproofing of the bathroom is one of the most important parameter and we have to ensure that the waterproofing systems are applied correct ly and careful ly. Wrong selection and incorrect application causes the premature failure against leakage and rectification becomes much costly and time-consuming and annoying too.

T h e m a i n p u r p o s e o f t h e waterproofing treatment is to stop the movement of water through the floor bed or moisture penetration through the walls and by drainage of the water providing proper slope to the drain points.

Generally common defects occur in bathrooms and toilets:

Seepage through structural joint because of use of poor quality material or insufficient water tightness due to poor application and main water source remains undetected and unattended.

Leakage through porous concrete because o f poor des ign and inadequate mixing concrete retains water and remains damp for long time.

Cracks in tiles because if the tiles are not soaked properly and if tiles are not tapped in place, they lose their water tightness with time and get damaged by subsequent construction activities.

Ti le de-bonding because of inadequate provision or wrong detailing joints or excessive shrinkage of the substrate due to improper mixing and insufficient curing.

Rust staining because of moisture

Waterproofing membraneThe complete floor with 300 mm

height along the periphery wall should be covered with suitable brush applied polymer modified cementitious base waterproofing membrane. Such waterproofing is termed as ‘tanking’ and the slope is to be maintained to effectively direct all water to a drainage outlet. Before applying waterproofing membrane, ensure that no loose dust particles or oil is there on the surface as these may debond the entire film.

The waterproofing membrane should be taken 150 mm along the floor upto adjacent floor area and a concrete kerb is to be provided at the

doorway so that no water can escape out of that doorway.

Corners between floors and walls are to be rounded with water tight polymer mixed cement sand systems and then a thick cement sand mortar is to be laid over the waterproofing membrane before laying of embedded pipes.

Pipe joints are to be well protected with waterproofing tape wrapped around them and floor bed is made.

Any pipe insertion and floor traps should be sealed at joint and encased with waterproofing tape.

Waterproofing membrane is then applied on the walls up to a height

of minimum 1800 mm and width of 1500 mm at shower areas before. The membrane must be elastic enough so that it should accommodate the movements.

Before putting tiles on the floor, a water penetration test is to be carried out to ensure water tightness.

Tiles are to be placed using polymeric tile adhesives and the joints are to be filled with tile joint filers so that no water can seep through them.

Ensure to follow the technical instructions and product manuals properly to achieve water tightness.

Sanjay Bahadur Global CEO, Construction Chemicals, Pidilite Industries

12September 02-08, 2013EQUIpMENT

‘We expect India CE market to grow faster than any other in the world’

How do you find the global market for construction equipment industry and its repercussions on India?

In 2011-12, we were around 3-4 per cent of the global equipment market but this has changed quickly because of the huge drop down in the China market by 30-35 per cent last year. There was a drop down in the European market and in the American market as well.

We can expect more investment and the India market to grow faster than any other market in the world, about 15-20 per cent. More and more mechanization and second city development will make the CE market grow further.

Could you elaborate on role of transformation in CE market with more and more technological advances to remain cost-efficient?

Mechanization is finally beginning to have a firm grip on the Indian construct ion equipment sector and the t ime duration to f inish projects is also reducing. But there has to be a constant upgrade of technologies along with introducing new technologies.

Increasingly machines are being designed to give better efficiency in terms of fuel consumption and productivity. At Volvo we add value to customers by offer ing them lowest cost of operation. To create fuel efficiency we are constantly innovating to make equipment that are fuel efficient while reducing emissions and environmental impact – OptiShift is a prime example of this.

Vo l v o ’ s u n i q u e O p t i S h i f t technology consists of two important features – a torque converter with lock-up and free wheel stator and Volvo’s patented Reverse By Braking (RBB) function. The combination of this technology has reduced fuel consumption by up to 15 per cent as well as increased machine performance and productivity.

We are also moving towards connectivity of our products through GPS system. Vo lvo CE is the first manufacturer to introduce a telematics system called CareTrack -- a telematics system that allows remote monitoring and machine diagnostics by using exclusive Machine Tracking Information System (Matris).

C a r e Tr a c k c o m b i n e s t w o independent systems; GPS and the mobile phone network, or data via satellite. These systems are coordinated in CareTrack and only two items need to be installed in the machine: a small computer with an integrated GPS receiver and modem plus an antenna.

It allows customers to monitor a machine through GSM connection and provide suitable maintenance suggestions. With CareTrack the customer gets the knowledge and information he needs to make the right decisions about his machine and thereby increase profitability. The customer can access the information he needs by entering into a password protected website, which gives him detailed information about his machine.

How do you see India’s provision of $1 trillion towards infrastructural project thrust in five year plan could enhance the demand for CE in India?

We have been waiting for this kind of opportunity. We have been around

Volvo Construction Equipment is one of the most dynamic companies in the global construction equipment market. A. M. Muralidharan, President, Volvo Construction Equipment (CE) India, shared his expert views with Pramod Shinde on current downturn in the construction equipment market, role of transformation in CE, India’s infrastructural spending to boost CE, Volvo CE initiative towards energy efficiency and importance of Volvo’s design thinking for construction equipment, etc. Excerpts:

5-6 per cent of the GDP for many years; the government recognises that and now we are moving towards 9-10 per cent of the GDP to be invested in infrastructure.

I think apart from government investment lot of private investment is needed as well. Also, there has to be a business model for the contractors to execute and complete projects faster and hand it over back to the government. As the government is investing more, private players are also investing more in infrastructure; i t ’s a good sign for equipment manufacturers like us.

How do you project Vovlo’s Electronic Paver Management (EPM) technology which has a great potential in India?

The EPM technology is used for laying new roads and maintaining old ones. We expect the growth possibility when Mumbai decides to relay all their roads from current concrete to asphalt roads.

The latest Electronic Pavers Management II system (EPM II) within the cab of a Volvo machine helps the operator monitor all working functions, and engine data and fuel consumption are displayed on a colour screen.

The EPM II contains a service interval as well as a settings manager, wh ich saves in fo rmat ion and settings for later times when similar conditions are present – saving time and increasing productivity and consistency. The EPM II console, screed control panel and auxiliary control panel can be removed and locked away when not in use for added security.

Tell us more about Volvo’s initiative towards fuel efficiency, which is a top priority among all construction equipment owners?

Volvo has been one of the earliest pioneers in driving higher fuel-efficiency, and one of the earliest in recognizing the environmental issue. We understand that fuel has two adverse attributes to it – one, it costs money and the more an equipment uses, the more expensive it gets; two, fuel consumption creates pollution, and hence the need to make engines even more judicious.

The Volvo diesel engine is at the heart of the company’s range of products. Based on well-proven, robust technology, the Volvo V-ACT engine range meets the needs of Indian customers by providing increased machine performance

along with reduced emissions – emissions that are ahead of the increasingly strict regulations on exhaust pollutants.

A l o n g w i t h e n v i r o n m e n t a l improvements, the V-ACT engine also represents new achievements in combustion efficiency and overall engine performance. With new fuel injection, air management technology and advanced electronics, the inherent potential of the V-ACT engine is then tailored by Volvo engineers to meet the specific performance criteria required by differing machine types and applications.

Fuel efficiency is often one of the demands of our customers. Hence we are constantly innovating to make equipment that are fuel-efficient while reducing emissions and environmental impact – OptiShift is a prime example of this.

Volvo’s unique OptiShift technology consists of two important features – A torque converter with lock-up and free wheel stator and Volvo’s patented Reverse By Braking (RBB) function. The combination of this technology has reduced fuel consumption by up to 15 per cent as well as increased machine performance in wheel loaders.

We recent ly in t roduced our Remanufactured (REMAN) Program to encourage users to keep their Volvo machines genuinely ‘a Volvo’. It allows users of Volvo CE to have their used components renovated to the same condition as new, thus eliminating the scope of environmental damage. This programme aims at creating an

eco-cycle and is testimony to Volvo’s commitment towards a greener environment.

How Volvo construction equipment ensure to rema in the bes t manufacturer of construction equipment among all the global players?

Volvo construction equipment is one of the most dynamic companies in the industry. Not only have we grown rapidly over the last decade — we have done so without sacrificing the quality of our products, the innovation of our thinking — or our close relationships with our growing family of customers.

We are proud to be a brand that has brought in technological innovations to the CE market in India. For example, we have drastically reduced service requirements on Articulated Haulers; introduced torque parallel linkage and the Volvo Care Cab with advanced features like RoPS (Roll Over Protection System) that allow operators to feel safe, be comfortable and in control.

Volvo CE is the first manufacturer to introduce a telematics system called CareTrack – the telematics system allows remote monitoring and mach ine d iagnos t i cs by using exclusive Machine Tracking Information System (Mirtis). All of these have given Volvo CE a distinct competitive advantage.

Volvo has been one of the earliest pioneers in driving higher fuel-efficiency, and one of the earliest in recognizing the environmental issue. We understand that fuel has two adverse attributes to it – one, it costs money and the more an equipment uses, the more expensive it gets; two, fuel consumption creates pollution, and hence the need to make engines even more judicious. Volvo CE takes a holistic approach to fuel efficiency. We deliver fuel efficiency across all elements of our machines via engines, systems, operator behaviour and future technologies while increasing the productivity for our customers.

Volvo believes in skill development. We have been actively investing i n t r a i n i n g a n d c o m p e t e n c e development to ensure there are trained labour and operators to operate advanced machinery. We have a operator training centre with all the latest machineries and also with simulators. Volvo has partnered with GMR Varalakshmi Foundation (GMRVF), the Corporate Social Responsibility arm of GMR Group, to offer an Operators Training Course, which will provide free training to under-privileged youth in India to operate construction machinery.

We have always focused on improving and increasing the ways we add value to our customers. In spite of the uncertainties of the market, we have maintained a steady growth in the market introducing new products, tapping new geographical locations and adding to our customer base. We have achieved this without sacrificing the quality of our existing products. The mantra behind this success is our innovative way of thinking and our close relationships with our growing family of customers and employees.

Could you highlight the importance of Volvo’s design, for construction equipment is ever changing?

The trend is towards managing va r ious componen ts th rough

September 02-08, 2013 13EQUIpMENT

electronics that also allows equipment to connect through web based portals.

Volvo CE is the first manufacturer to introduce a telematics system called CareTrack -- a telematics system that allows remote monitoring and mach ine d iagnos t i cs by using exclusive Machine Tracking Information System (Matris).

It allows customers to monitor a machine through GSM connection and provide suitable maintenance suggestions. CareTrack combines two independent systems; GPS and the mobile phone network, or data via satellite.

These systems are coordinated in CareTrack and only two items need to be installed in the machine: a small computer with an integrated GPS receiver and modem plus an antenna. With CareTrack a customer gets the knowledge and information he needs to make the right decisions about his machine and thereby increase profitability.

The customer can access the information he needs by entering into a password protected website, which gives him detailed information about his machine.

How about Volvo construction equipment commitment towards advance t ra in ing for sk i l led development?

Volvo believes in skill development. We have been actively investing i n t r a i n i n g a n d c o m p e t e n c e development to ensure there are trained labour and operators to operate advanced machinery.

We have an operator training centre with all the latest machineries and also with simulators. Volvo has partnered with GMR Varalakshmi Foundation (GMRVF), the Corporate Social Responsibility arm of GMR Group, to offer an Operators Training Course, which will provide free training to under-privileged youth in India to operate construction machinery.

How do you find the market for used equipment in India and Volvo’s market share in the existing market?

Second hand machinery are used extensively in India and with the global downturn customers are more likely to focus on using their existing machines for longer period of time than buying new ones.

A l l manufacturers inc luding Volvo focus on providing excellent aftermarket service to customers to ensure their machines have longer run time. We also have enough capacity and knowledge to repair old machines and therefore import is not high on our list.

Could you provide your customer experience while relying on Volvo CE, which provides complete solution to its customers?

We have focused on improving and increasing the ways we add value to our customers. In spite of the uncertainties of the market, we have maintained a steady growth in the market introducing new products, tapping new geographical locations and adding to our customer base.

We have achieved this without sacrificing the quality of our existing products. The mantra behind this success is our innovative way of thinking and our close relationships with our growing family of customers and employees.

Last year Volvo launched the Customer Contact Center ‘V Care’ which will help customers achieve higher productivity by minimizing their machine downtime. The centre will record and process all customer issues centrally and in real-time, giving Volvo CE the ability to monitor dealership customer serviceability and enable them to resolve customer issues quickly and efficiently.

The new centre is an integral part of Volvo CE’s objective to offer customers total lifecycle care – from providing equipment to support and partnership – and ensure customer complete satisfaction.

Would you mind sharing with us the total business transacted in the last three years and which are key equipment that were in demand? Also, the future projection for the Indian market?

The key equipment that were in demand were Pavers , So i l Compactors and Motor Graders.

The future of the market is very positive. Though 2012 was better than 2011, we hope 2013 will be

a turning point. There is lot of work to be done in this country and for the next 10-15 years. I feel there will be good opportunities for manufacturers like us. I don’t see any concern at this point in terms of capacity or equipment utilisation.

A n y p l a n s t o e x p o r t y o u r equipment elsewhere in Asia?

Volvo construction equipment has global presence and investment has been made in different countries to manufacture and supply products to respective countries. We currently export few models out of India. We are working towards more exports in the future.

14September 02-08, 2013

‘Upturn in demand for construction equipment by 2014 H2’

The VDMA (Verband Deutscher Maschinen-und Anlagenbau-the German Engineering Federation) is the largest engineering and equipment industry network in Europe and supplies machinery to the global market. Among its global subsidiaries, VDMA India maintains 14 sectors and has its liaison office in Kolkata.

The German Engineering Federation serves Indo-German economic relations in different engineering sectors. VDMA India promotes activities of the VDMA member companies in India.

It is constantly maintaining close relations with the Indian industry, Indo-German companies, embassies, consulates and various Indian industry associations, especially with CII, Ficci, EEPC, Assocham, Fieo, Capexil, ICC, IGCC, etc. It also facilitates joint ventures between German and Indian companies for mutual benefit.

While commenting about global market slowdown, German machinery and tool association stated that its

Rajesh Nath, Managing Director, VDMA shared his views with Pramod Shinde about present slowdown in construction equipment which would remain uncertain this year, but he expects slight upward swing in the second half of 2014. He emphasized the importance of using tower cranes, concrete pumps and man hoist systems especially for high-rise buildings which will help India in improving construction quality and also prevent overrun of construction cost. The Indian construction industry’s output is expected to record a CAGR of 15.45 per cent over the next five-year period, he further added. Excerpts:

overall orders fell short 5 per cent in real terms of last year’s result. Domestic business slumped by 4 per cent, international business by 6 per cent, reported the German Engineering Federation in June this year.

Once again, incoming orders for machinery from Eurozone partners were disappointing. Given the double-digit decline (minus 19 per cent), it remains difficult for capital goods manufacturers to speak about economic stabilization in Eurozone.

How do you analyse global demand and supply for construct ion equipment and its repercussion on the Indian market?

The construct ion equipment business cycle, which showed a remarkable growth in years 2010 and 2011, has shown a modest decline last year. In 2012, the building construction equipment orders, globally, were up by around 5 per cent and sales figures grew by around 15 per cent.

But due to a low demand in the earthmoving and road equipment market, the overall growth in the construction equipment industry decreased by 2 per cent. The global demand for construction equipments remains uncertain this year.

Emerging markets like India, Russia and China are expected to be the driving force. After the downturn in 2012 and continuing decline in 2013, a slight upward swing is expected in the second half of 2014.

Tell us about the VDMA construction equipment industry initiatives t o w a r d s r e d u c i n g c a r b o n emission.

For the past 10 years the European construction equipment industry has a proven track record of increased p roduc t p rocess and energy efficiency, consequent reduction in fuel consumption and engine emissions. The European construction equipment industry is strongly committed to CO2 to NOx and to particulate reduction, but with a realistic and sector specific approach.

Would you like to share your thoughts towards India’s needs to absorb building material technology for high-rise building in order to mitigate labour shortage and cost escalation?

India needs to adopt various building material technologies like the mass concrete construction

technology, usage of hollow bricks, tower cranes and man hoist systems for high-rise buildings.

Usage of hollow bricks instead of traditional bricks will help in energy saving and economise construction cost. Moreover, usage of tower cranes, concrete pumps and man hoist systems, especially for high-rise buildings, will help in improving construction quality and preventing overrun of construction cost.

Can the Government of India’s thrust on infrastructure spending spur market for VDMA members for construction and building material machinery?

The Union Budget 2013-14 has been a pragmatic one that emphasizes the need to revive growth and provide some measures to promote investments. The 29 per cent growth in plan expenditure, thrust on key infrastructure sectors like road and coal and emphasis on the need to facilitate infrastructure financing

and Germany reached Euro 17.6 billion (Rs 123200 crore). In 2012 Germany exported approx Euro 10.38 billion (Rs 72660 crore) of goods to India. Out of this the machinery export was approx Euro 3.62 billion (Rs 25340 crore). Among the machinery sectors, demand for construction equipment and building material machinery grew by 4.7 per cent.

Out of the machinery imported by India, Germany has a share of around 11 per cent in construction equipment, ranking 5 globally and a share of 14 cent cent in building material machinery, ranking third globally.

In 2012, the German construction equipment and building material machinery industry generated Euro 12.5 billion in turnover. Construction equipment constituted Euro 7.9 billion of this value, while Euro 4.6 billion were made with building material, glass and ceramic machinery.

EQUIpMENT

through innovative instruments are positive measures.

Some revival in capital expenditure cycle is expected with the proposed investment allowance of 15 per cent for companies investing more than Rs 1 billion in plant and machinery over the next two financial years.

Furthermore, continued focus on increasing the availability of long-term funding sources for infrastructure projects is positive, considering the significant planned investments on infrastructure in the 12th Five-Year Plan.

Factors including the stimulus given by the government for infrastructure development, and continual articulation of the government about the thrust given to infrastructure development are giving big boost to the growth of the Indian infrastructure and the construction equipment industry. However, to fully realize the potential, there should be concerted and well-coordinated efforts by the industry and the government.

The increased al location for infrastructure sector can pave the way for Indian construction companies to utilise energy efficient and robust technology offered by the German construction equipment and building machinery suppliers.

Would you like to share export trends from Germany to India towards construction and building material machinery in the past five years?

In 2012, the trade between India

Would rapid urbanisation of tier-2, -3 and -4 cities enhance the scope for VDMA construction and building material machinery in India?

The Indian construction industry increased in value at a CAGR of 15.10 per cent during the period 2008-2012. This growth was supported by the country’s expanding economy, increased government spending on publ ic in f ras t ructure , h igh urbanization and supportive foreign direct investment (FDI) system.

The construction industry growth is expected to remain strong over the forecast period 2013-2017, as a result of the government’s commitment to improving the country’s infrastructure. The Indian construction industry’s output is expected to record a CAGR of 15.45 per cent over the next five year period.

T h e g e n e r a l o u t l o o k f o r construction activity during the five-year forecast period is positive. Construction activity in residential market will be driven by demand side factors, such as growth in nuclear families and the rising urbanization rate, as well as government support and state investment in affordable housing schemes.

As a result, the construction equipment sector in India, which has been witnessing robust demand in recent years, stands to gain maximum due to rapid rise in construction activity in future.

16September 02-08, 2013pORTS

With 13 major ports and more than 180 minor ports, India’s 7, 517 km long coastline plays a vital role in maritime transport along with offering huge international trade capabilities. Being a focus area for development and refurbishment, Indian ports are increasingly becoming an attractive investment option for investors scouting for opportunities in Indian market.

The current port scenario in the country offers a huge scope for expansion of international maritime transport; both for passengers and cargo handling. India’s 12 big ports, which account for about 58 per cent of the total cargo shipped through the country’s ports, handled 137 million tons (mt) of goods in the first quarter of FY14.

Container cargo volumes at these 12 ports stood at 1.87 million standard containers during the reported quarter, according to data compiled by the Indian Ports Association (IPA) as per research reports by IBEF.

Cargo growth at Indian ports was estimated to be moderate in the past two years, with the overall increase in throughput at 4 pc y-o-y. What has been the impact in cargo volumes at major ports (1.6 pc y-o-y rise) because of a significant reduction in volumes of iron ore, a major cargo category, following Karnataka’s banning of iron ore exports since August 2010?

The sharp decline in export and import volumes being handled at major ports is basically due to the growth slowdown of the Indian economy. The fiscal ending March 2013 saw cargo handled by the 12 major ports shrink by 2.5 per cent, to 545 million tons (mt), from 561mt in 2011-12. That makes it the lowest in last four years. Major ports handled about 60 per cent of cargo handled across ports, according to 2011-12 data.

The primary reason for a drop in the performance of major ports is the drop in iron ore exports since expected exports to China did not take place. Further, Karnataka had placed a ban on iron exports as well. So this was double whammy.

We are aware that commerce ministry as well as finance ministry is grappling with this problem of poor exports -- since this has been the singular factor for our jump in current account deficit to almost 5.7 per cent of Gross Domestic Product (GDP).

A lift in our trade figures would automatically translate to higher business for our ports and other ancillary services. We are keeping our fingers crossed and are expecting that India would perform better in International trade in the current fiscal.

Since the last decade, the Indian port sector has been witnessing certain structural changes, with state monopoly (viz. the major ports) gradually giving way to greater private sector participation in port investment activity. What is your take including the large investments required to scale up port capacity, besides the need to improve service levels and efficiency?

There are some critical key issues hindering growth of the Indian Port Sector as compared to the international ports. Investments need to be made in the following areas in order to improve the infrastructure and to scale up existing capacity at Indian ports.

Increase capacity: As per the latest statistics around 8 of the 13 major ports are operating at more than optimum range of 70-75 per cent utilization. Further, four of these, namely, Vizag, Tuticorin, Mormugao, and Mumbai ports are experiencing more than 100 per cent utilization. Correspondingly, the average capacity utilization at non-major ports was ~ 77 per cent in 2009-10.

Capacity at existing ports needs to be increased so that they can cater to the demand of the Exim trade in an efficient and effective manner. Capacity constraints at major ports are resulting in slower vessel turnaround times, thus increasing congestion at these ports resulting in higher cost to the trade.

Ineff ic ient cargo handl ing & low productivity: Cargo handling equipment and services primarily at most Indian ports are inefficient. Most

How does the company deal with the interest rate, regulatory risks emanating from an evolving policy environment; cargo concentration risk particularly for entities having a high exposure to iron-ore cargo given the ongoing uncertainties in iron ore mining activities in various states?

Dighi Port is all-weather, direct berthing, deep draft port which is capable of handling dry bulk, break-bulk, liquid, LNG and Ro-Ro cargo. At present only one berth is operational and remaining four berths are under construction.

The port is handling cargo such as coal, bauxite and steel. All the berths that are being constructed are being developed as multipurpose and multi cargo berths, which are capable of handling all types of cargo.

Dighi Port is not dependent on a single cargo type and is geared to handle all types of cargo. Hence the ban on iron ore mining and handling iron ore will not impact on the port in any way.

What is the possibility of temporary capacity overhang in some cargo segments and incremental risks associated with expansion in scope of business/inorganic growth?

There is definitely a high possibility of capacity overhang in some cargo segments and other incremental risks such as project execution risks given that many port companies are in a moderate to large scale capital expenditure mode, the hardening interest rate, the environment and regulatory risks emanating from an evolving policy environment and lastly cargo concentration risk particularly for entities having a high exposure to iron-ore cargo given the ongoing uncertainties on iron ore mining activities in various states.

India’s long coastline of over 7,500 km is home to the country’s 13 major ports1 and around 200 minor ports located along the western and eastern corridors. While the number of non-major ports is large, only about one-third of them undertake regular commercial operations? What business opportunities does Dighi port explore?

A majority of the non-major ports are mainly fishery and intermediate ports. These ports carry out lighter age operations which plays an important role in keeping major ports less congested. Most of the major ports are getting choked due to high demand hence cargo is getting diverted to the nearest non-major port.

Pipavav, Mundra and Dahej are few ports in Gujarat which had an advantage due to the lack of infrastructure at major ports to cater to the high demand and are currently handling large volumes as compared to other non-major ports.

Dighi Port is ideally located to cater to the west and central India markets. The port is located at a distance of 42NM from Mumbai Port and at a distance of 170 km south of Mumbai by road. Due to its favorable location and proximity to Mumbai, Dighi Port is being seen as the next port of choice on the West Coast of India as ports in Mumbai are operating above capacity and are facing issues such as congestion and slow turnaround of vessels. Maharashtra is having ample amount of customer base for the upcoming port like us.

Further, as Dighi Port is being developed on two banks of the Rajpuri Creek as an all-weather, deep draft, direct berthing, multipurpose and multi cargo port capable of

handling dry bulk, break-bulk, liquid and LNG cargo, it has the capability to handle all types of cargo with the advantage of segregating dirty and clean cargo to a particular bank.

The port offers a large land bank in excess of 1,500 acres and close to 5 km of waterfront for development of additional berthing facilities for cargo types which require dedicated infrastructure.

Dighi Port is also the only port in Maharashtra that is developing a port-based Sez and FTWZ. Last but not the least, Dighi Port is the last node of the Delhi Mumbai Industrial Corridor (DMIC) and has also been

‘Energy sector will drive demand across major, minor ports’

The Dighi Special Economic Zone (Sez) is a duty-free enclave, deemed to be a foreign territory for the purpose of trade operations, duties and tariffs. It is a multi-industry Sez, with a land bank of over 2,000 acres as one of the largest ports based Sez in Maharashtra. The port is currently planning two river banks which give a unique advantage of handling all types of cargo where on completion will have 16 terminals. Vijay G. Kalantri, CMD, Dighi Port Ltd delved into the port sector in this interaction with Remona Divekar. Excerpts:

included as one of seven mega National Investment & Manufacturing Zones (NIMZ) under the Government of India’s new manufacturing policy. Hence the opportunit ies galore for Dighi Port which is geared up for handling these opportunities efficiently and effectively.

berths do not have dedicated cargo handling facilities necessary for the quick handling of cargo.

As per the study carried out in 2010 by the Controller and Auditor General of India (Cag), i t was observed that around 55 per cent of the equipment available at all ports, except at the Jawaharlal Nehru Port Trust (JNPT), were running beyond their rated economic lives, resulting in low utilization. Apart from that, wide variations were observed in efficiency levels among the 13 major ports.

September 02-08, 2013 17pORTS

The average pre-berthing time in Indian major ports varies between 0.4 hours and 23 hours. The average turnaround time also varies between two to five days. In contrast, the turnaround time at globally competing ports like Singapore or Hong Kong is between four and six hours.

Deeper drafts: Future shipping trends point towards larger vessels with a minimum of 6,000-8,000 teus and a few vessels with 1,2000-1,4000 teus. These future generation vessels would require drafts between 13 to 15.5 m.

Due to current draft restrictions, several Indian ports are unable to handle larger vessels typically with more than 9.5m and 12.5m draft. This could lead to shipping lines and shipping companies moving to other ports which offer deeper drafts as it provides the shipping lines and companies with economies of scale. Hence it is paramount importance the ports in India undergo dredging and offer drafts to accommodate most vessels that are plying in most parts of the world.

Improve connectivity: Lack of proper connectivity has affected the growth and prospects of many ports. Despite having proper depth and adequate facilities, these ports are stranded for the want of cargo, while the other ports are burdened with an

excess they can’t handle. The private players (coal traders,

other manufacturers cum exporters/importers) give considerable weightage to connectivity at the proposed port while considering a stake in port development.

Connectivity is the basic lifeline of any port. Inadequate hinterland connectivity will hinder the growth of external trade and therefore the development of the economy. It typically results in suboptimal choice of route and mode of transport, leading to time and cost escalations, and in many cases, congestion in the ports due to an inability to move cargo out of the port. It is imperative that investments be made in developing port infrastructure.

What is your take on private participation in ports that is being facilitated by an open policy regime (which, inter alia, allows 100 pc FDI investment in port projects and provides taxation benefits to players investing in port infrastructure) and the prospects of robust returns on investment, given the favorable long-term outlook for the sector?

PPP projects were introduced in the Indian port sector in the late 1990s to enable scaling up of capacity, given that the surplus with the major ports was inadequate for the incremental

investments needed and reliance only on budgetary support for the required large-scale capital expenditures was unsustainable.

Also, the involvement of the private sector was expected to result in improvements in the operating efficiency and performance standards of the major ports. Till March 31, 2011, a total of 29 PPP projects entailing a total investment of over Rs 92 billion had been completed and were in operation at the major ports (includes both captive and commercial projects). Another 20 projects entailing an investment of over Rs 100 billion are under way at various major ports.

The progress of PPP projects in the Indian port sector has not been up to the mark because of various policy related impediments, both at the pre- and post-award stages. In the pre-award stage, the problems initially arose because of lack of clarity on the bidding framework, qualification criteria, and concession terms.

These were later resolved with the finalization of model documents. In the bidding stage, the process has tended to be protracted with the bureaucratic procedures at most major ports often leading to cancellations and re-bidding. Post-award, there have been delays in execution because of the time taken to obtain environmental and other statutory clearances.

Post-commissioning, BoT terminals have had to face operational problems because of their high dependence on the port trust for common facilities like capital dredging, pilotage and vessel movement as these have had an adverse impact on their efficiency and competitiveness.

Also, the tariff fixing methodology under Tariff Authority for Major Ports (Tamp) has had a negative impact on the profitability and returns of PPP project developers because of several factors.

These include the lengthy process of tariff fixing and review, anomalies in the tariff setting mechanism (like

not allowing full pass-through of revenue share), low rate of allowed tariff increase because of indexation to inflation and uncertainty on whether the operator would be allowed a tariff increase if its investment was higher than originally envisaged.

Going forward, the success of the PPP framework in the port sector hinges on the way these issues are addressed and some progress on this front has been made with certain regulatory and policy initiatives being taken.

Going forward what are the growth drivers of Indian ports? Is it by higher volumes of coal that can meet the requirements of the large number of current or proposed thermal power projects based on imported coal); containers (given the market under-penetration and potential for cost savings); crude oil and PoL (large upcoming refinery capacity); fertilizers (strong domestic demand and low self-sufficiency); and steel (mega projects proposed in the eastern part of the country)?

For ports all the products are equally important and each one of them plays a significant role in the development of any nation. While PoL and coal shows us the consumption of the energy sector and power projects in the country, fertilizer and container business tells us the huge consumption we have.

From the total imports in the country around 50 per cent is PoL which will continue rising because of ever increasing fuel consumption. However, in the near future Energy sector will drive the demand across the major and non-major ports in the country. World over container business has picked up due to logistics suitability.

Containerized cargo is expected to grow at 15.5 per cent (CAGR) over the next seven years. India’s existing ports infrastructure is not sufficient to handle the increased loads. Cargo unloading at many ports is currently inadequate, even where ports have already been modernized. Going forward the major

cargo types that are going to be handled at most ports in India will be coal, PoL and containers.

In line with the expected growth, consider ing the incremental investments in ports what is the Dighi Port capacity designed to specifically service these cargo categories? What are the growth drivers in India? Are they largely based on domestic demand drivers that are fundamentally stronger and more stable compared with international trade related demand?

Dighi Port is currently handling shipments of coal, steel coils and bauxite. With coal boosting the energy requirement of power plants in the hinterland of Maharashtra and M.P. Steel coils imports will boost the manufacturing sector in the region.

In phase-1 of development, the port is constructing two multipurpose berths that have been constructed on the South Bank of the port, three mult ipurpose berths are under construction on the North Bank which will be operational by First Quarter 2014. At the end of phase-1 the port will have installed capacity of 30 million mts.

All dry bulk, break – bulk and liquid cargo as well as LNG will be handled on the South Bank where as the three berths on the North Bank having a total quay length of 1,100m will be used for handling containers and RO cargo.

The port has also deployed modern cargo handling equipment with adequate stack yards and warehousing facil i t ies, back up areas with an ample land bank of approximately 1,600 acres. With the gateway ports in Mumbai currently working at full capacity and even at stretched capacity, Dighi Port with its strategic location and well-planned infrastructure is geared and ready to handle the cargo generating from north, west and central India in a hassle-free and economically viable manner.

18September 02-08, 2013

‘Hydromedia, an ideal solution for surface, storm water management’

Rapid urbanization has seen the increased use of impervious surfaces. Traditionally road and pavement surfaces are designed with kerbs and gutters that are directly connected to surface drainage networks which cause instantaneous water flow rates. In these circumstances runoff water can become difficult to manage and can increase the risk of flash flooding.

Surfaces laid in a system integrating pervious concrete offer a good level of rain water infiltration and provide an economical method to store runoff water (through the entire system, see below), eventually replenishing ground water levels.

Hydromedia surface promotes and enhances the performance of SUDS 3, a key tenant of developing sustainable planning. Increasing the impervious area surrounding the shop and local farm buildings was seen to have the potential to exacerbate existing concerns and issues of flooding during periods of high rainfall. Hydromedia offered the ability to increase the hard standing area whilst maintaining the pre-existing infiltration rates.

More importantly Hydromedia was seen as a solution to mitigate a significant health and safety concern of water ponding and during periods of low temperature creating ice patches and risks to customers. The extent of the area paved was approximately 190m 2, with the system constructed of 150mm of Hydromedia (28.5 m 3) over a 200mm permeable aggregate sub-base on top of the existing sub-grade.

Exp la in us the reasons on conceptualization of Hydromedia? How can they be instrumental in developing sustainable planning, infrastructure and also help to resolve number of issue that wouldn’t be solved by traditional methods?

Urbanization is one of the biggest challenges of the 21st century. Over the next decade, cities will change substantially, as population growth is anticipated to occur almost exclusively in urban areas. By 2050, 70 per cent of the world’s population will be living in towns and cities, compared with just over 50% today, resulting in two billion more city-dwellers.

Development at this unprecedented scale will add strain on the natural resources and also pose a major challenge for the whole construction industry. This rapid rate of urbanization has created additional challenges of water management across cities.

result ing from exceptional high t ide, except ional water s torm, exceptionally long period of rainfall it might be the result of a global climatic change, yet we prefer to let the climate experts make the statement.

As a matter of fact, Hydromedia is a new solution that can bring a certain peace of mind to home owners that the rainwater will not flood into their residential plot but will safely drain to the water tables, thanks to an adapted sub base treatment of course.

How does Hydromedia function and so far where has it been installed? Which ways does it help to mitigate damage such as bursting riverbank, overflowing drains? How does the typical system of Hydromedia function over undisturbed soil?

Hydromedia is a no-fines concrete that is particularly fluid in application,

As a leading construction materials manufacturing company, Lafarge has developed an innovative product which helps in faster drainage of surface water. Hydromedia was developed after extensive research and development work in France. It is a new pervious concrete solution to allow better water management, allows the water to return to the water table and helps addressing the water management issues even at the time of increasingly extreme climatic conditions, heavy storms, drought, etc.

Rapid urbanization increases the use of impervious surfaces. Typical road and pavement surfaces with roof kerbs and gutters that are directly connected to drainage networks

permeability of 150 - 1000 L/min/m². Hydromedia is a very porous

concrete which, thanks to its high permeability and drainage capacity, allows for rapid surface water removal in the event of storms, helping to prevent the overloading of existing storm water management systems and therefore reducing the risk of flash flooding.

It minimizes the urban impact on the natural water cycle, allowing for the natural replenishment of water tables in urban environments that up till now have typically been covered with impervious asphalt or conventional concrete surfaces.

I t a lso reduces the overa l l environmental footprint of on-site

CONSTRUCTION CHEMICALS

because instantaneous water feed rates.

This makes drainage of water difficult to manage and increases the risk of flash flooding in areas of risk. Surfaces laid out in a system that integrates pervious concrete allow good rain water infiltration and provide an economical method to store runoff water. This system eventually replenishes ground water levels.

In these circumstances how does Hydromedia manage water run off that can become difficult to manage and increase the risk of flash flooding?

Hydromedia is an innovative product developed by Lafarge and an ideal solution for surface and storm water management. Typically containing 20-35 per cent void space, it allows water to buffer in its mass depending on its thickness and/or to pass directly through it at a

storm water management systems, as no storm piping or catchment basins are required. The use of Hydromedia placed on an aggregates storage sub-base layer is sufficient to handle storm water effectively.

How does Hydromedia of fer the ability to increase the hard standing area whilst maintaining the pre-existing infiltration rates increasing the impervious area surrounding the local buildings which, was seen to have the potential to exacerbate existing concerns and issues of flooding during the periods of high rainfall?

Hydromedia minimizes the urban impact on the natural water cycle, allowing for the natural replenishment of water tables in urban environments that up till now have typically been covered with impervious asphalt or concrete surfaces.

I t a lso reduces the overa l l

H y d r o m e d i a i s a d a p t e d for al leyways, commercial and residential parking lots, pavements and pedestrian pathways. Its use is optimized when it is integrated into a complete water management system. It is extensively used in low-volume pavements like residential roads and parking lots, sidewalks, bike and pedestrian pathways, pavement edge drains and gutters, sport courts and alleyways/driveways.

What is Hydromedia’s solution to mitigate significant health and safety concerns of water ponding significant during periods of low temperature creating ice patches and risks to customers?

Hydromedia conveys rapidly, if not instantly, surface water into the pavement subcase. Hence, risk of stagnating water is eliminated with the entire health and safety hazard related to it.

Hydromedia surface has also exce l len t s l ip res is tance tha t minimizes risk of accidental slipping of pedestrians to an acceptable level in both dry and wet conditions. During storm water, rainfalls and/or flash flooding, what happen often in region exposed to the monsoon, the pedestrians can engage with more confidence and safely on a pavement made of Hydromedia.

How does Hydromedia function to surface water management in concrete system that allows free water to flow directly through the product into the substrate below especially to curtail in the scenario global climatic change?

We observed more and more water management issue worldwide,

Hydromedia is a solution to mitigate a significant health and safety concern of water ponding and during periods of low temperature, creating ice patches and risks to customers. It promotes and enhances sustainable planning, says Lionel Bourbon, Head Construction Development Lab, Lafarge India in an interview with Remona Divekar. Excerpts:

but highly robust and resilient after placement and curing. The key to this is Lafarge’s innovative paste technology, where the rheological properties are a carefully calculated and balanced between fluidity and viscosity, offering short-term flexibility and long-term strength.

The aggregate matrix is also designed to minimize compaction and provide a predictable and homogenous permeability in the final hardened product. The choice of materials, combined with the specially-created mix design tool, ensures that final properties of the concrete can be engineered prior to placement, allowing for a predictable and consistent designed solution for storm water management. All the expertise of Lafarge is visible with Hydromedia. Hydromedia was launched in 2011 in UK, Eastern Canada, and the US and in France.

Which more segments are you planning to target and what is the scope of the success of this product in the long run? Share with us your future business plans. Hydromedia is perfectly adapted for low-traffic pavements (internal road, parking, pedestrian pathway).

It has a wide scope of success for the urban residential segment replacing conventional pavement like tiles or any other impervious sur faces. Hydromedia is a lso available in different colours, which makes it even more attractive for home owners or even architects.

envi ronmental footpr int of on-s i te s torm water management systems, as no storm piping or catchment basins are required. The use of Hydromedia placed on an aggregates storage sub-base layer which is sufficient to handle storm water effectively.

September 02-08, 2013 19

20September 02-08, 2013pROJECTS UpDATE

CCI wants expeditious clearances of 36 infra projects

MoEF urged to give faster approvals to power projects

The Cabinet Commit tee on Investment has decided to ask min is t r ies concerned to c lear exped i t ious ly as many as 36 infrastructure projects stuck due to delay in sanctions, sources said. The panel, in its meeting on Monday, decided that all the pending approvals for 36 core sector projects, including 28 power plants, by ministr ies concerned should be given in the next 60 days, sources said.

In its last meeting, the CCI cleared the proposal of setting up two hydro

power projects in Arunachal Pradesh. The panel has so far cleared 171 projects worth Rs 1.69 lakh crore.

The government set up the CCI, headed by Prime Minister Manmohan Singh, to expedite decisions on approva ls fo r implementa t ion of projects. The stalled projects are initially tracked by a project monitoring group wherein ministries or department concerned discuss issues that are adversely impacting implementation of the identified projects.

The Cabinet Commit tee on Investments (CCI) has asked the Ministry of Environment & Forests (MoEF) to expedite approvals for nearly Rs 50,000-crore worth power projects.

These projects belong to, among others, private players such as Essar Power, Reliance Power and Jaiprakash Power Ventures. Sources said that the Ministries of Coal, Power, Mines and Environment and Forests have been directed to sort out issues pending with States within the next ‘six months.’

Based on the discussions, efforts are made to expedite clearances and the final decisions or unresolved policy issues and clearances are taken by the CCI.

DMICDC mulls intra-city rail network in

Gujarat The Delhi-Mumbai Industr ial

Corridor Development Corporation (DMICDC) plans to build an intra-city rail network in the Dholera Special Investment Region in Gujarat. The project is estimated to cost $500 million.

The Dholera region, spread over 900 square kilometres, is being developed as a new greenfield industrial hub in Gujarat. It is about 100 km south of Ahmedabad and a designated investment zone under the ambitious Delhi Mumbai Industrial corridor project.

DMICDC is the lead developer of Dholera. The Delhi Mumbai Industrial Corridor Development project is being partly funded by the Japanese government.

A senior off ic ial of DMICDC said that since Dholera is being developed as a city of the future with an integrated infrastructure, this will help attract investments and enhance productivity. Therefore, the corporation is considering the setting up either a mono or Metro rail system for commuters to travel within the city.

The corporation will shortly appoint a consultant to study the technical and financial feasibility of the transport project. The DMIDC has already acquired about 100 sq. km. of land under the first phase. Construction for the city will start by December. The land has been acquired using the pooling method, which ensures that the original owner gets back compensatory land close to the project site.

“The high-level panel took an update on the progress of fuel supply agreement for 78,000 mw,” informed a minister present at the panel meeting.

Coal Minister Sriprakash Jaiswal informed the panel that Coal India has agreed to sign fuel pacts for Rs 83,772 crore of power projects by August 31.

The projects reviewed by the Committee include ‘diversion of forest land’ for the Rs 20,852-crore Sasan Power belonging to the Anil Ambani Group. The Ministry of Environment & Forests has been told to pursue with the Madhya Pradesh Government the Chhatrasal coal block associated with this power project. Essar Power’s Tori-I power plant in Jharkhand faces a similar problem. The MoEF has not received the required proposals from the state to give its go-ahead for the Rs 5,700-crore project.

September 02-08, 2013 21pROJECTS UpDATE

Japan eyes larger stake in Chennai-Bengaluru

industrial corridorA parliamentary delegation from

Japan which visited Bengaluru to further trade relations with the state said recently that it is looking forward to a larger stake in the upcoming Chennai-Bengaluru Industrial Corridor (CBIC), a mega industrial project.

The corridor is planned along Chennai, Sriperumbudur, Ranipet, Chittoor, Bangarupalem, Palamaner, Bangarpet, Hoskote and Bengaluru and is expected to boost commerce between South India and East Asia by enabling quicker movement of goods from these places to the Chennai and Ennore ports.

Katsuyuki Kawai, Chairman of the Standing Committee on Foreign Affairs of Japan’s House of Representatives, who led the delegation, said that he has discussed a wider role for Japanese industry in developing the CBIC – a venture jointly promoted by Department of Industrial Policy and promotion (DIPP) and the Japan International Cooperation Agency (Jica).

“Japan can play a greater share in intensifying industrial activity through active participation in the development of this corridor,” Kawai said, noting that the high concentration of information

technology firms in Bengaluru had impressed the Japanese delegation.

The delegation, which visited facilities of Sony India and Yokogawa India, said it was impressed by the industrial clusters, especially in the IT sector, which Kawai said holds huge potential for the economic growth of Karnataka.

Promising to promote Bengaluru as an investment destination with Japanese Prime Minister Shinzo Abe, he said that the state’s infrastructure was still a painpoint for investors.

Reliance Infra said on Tuesday last it planned to commission the Mumbai Metro rail project this year.

“We are geared up to bring it in this year and waiting for requisite approvals," said Lalit Jalan, Chief Executive, at the 84th annual general meeting.

The company’s Chairman Anil Ambani said the firm is contemplating expansion of the Metro line even before starting operations. “It can accommodate 700,000 passengers a day. We plan to bring it up to one million passengers a day,” he said.

Amban i a lso t r i ed to a l lay shareholders’ fears on the Delhi Airport Express project, from which the company recently exited, citing

faults in the civil structure constructed by Delhi Metro Rail Corporation. “We are confident of recovering all our investment in the project,” he added. Ambani said the company charted a five-year growth path from being a Mumbai power distribution company to a being a full-fledged infrastructure company. “All our projects will be revenue-operational within the financial year,” he said.

It includes road projects, Metro project and transmission lines. The company also plans to bring its first cement plant to operation at Maihar in Madhya Pradesh. The plant has annual capacity of 5 million tons and will use the fly ash from Reliance Power’s Sasan plant.

Road Ministry asks states to expedite

pending projects on East-West corridor

The Road Transport & Highways Ministry has asked state governments including Bihar and Assam to expedite pending projects on the East West Corridor under its flagship road building programme NHDP.

"Four-laning of the entire length of East West corridor has been completed barring projects for 232 km, which are still to be awarded," said a top official at the ministry.

"These stretches are mostly in states like Assam and Bihar, where work could not progress on some stretches due to various problems. We have taken up the matter with the state governments," said the official.

The official said the award could not be completed so far on account of delays in land acquisition, problems in forest clearances and poor law and order situation. The entire length of the project has been completed barring the 232 km for award and 195 km which is under execution, he added.

The East-West Corridor under the National Highways Development P ro jec t (NHDP) has seen an expenditure of Rs 27,000 crore so far.

While the North South (NS) Corridor Connects Srinagar to Kanyakumari, East West (ES) Corridor connects Porbandar to Silchar. The total length of the NS-ES network is 7,300 km. The project was originally scheduled to be completed in 2009.

The official said that while the regional offices, headed by chief general managers of the National Highways Authority of India (NHAI) had been making efforts for expediting land acquisition in the areas, the matter has also been taken up with the chief secretaries of the concerned states.

He said four laning of NH-57 in Bihar has been completed except, Narpatganj portion due to problems in land acquisition. Likewise, most of the work on 670-km stretch of the corridor in Assam has been completed but there are stretches where work could not be done due to law and order as well as weather conditions, he said.

So far over 500 km of the corridor in Nagaon-Daboka-Lanka -Udali section of Assam has been completed.

C o n c e r n e d o v e r t h e s l o w progress of projects under NHDP, a Parliamentary panel had recently asked the ministry to take steps for expediting them and attracting private investment.

Mumbai Metro to become operational this year: RInfra

22September 02-08, 2013

‘Real estate stock exchange need of the hour’

As a key real estate player and a successful entrepreneur, what have been KMB Group’s (Real Estate) noteworthy achievements in the business?

KMB Estates was founded as a direct result of Ramesh Bulchandani developing var ious resident ia l properties across western India. As a tribute, the company has been named after his grandfather, Dr. Kishinchand M. Bulchandani, who with his sons pioneered real estate development in Mumbai in the 1950s from Khar to Marine Drive, also founding the National Hospital (now Hinduja National Hospital) and National Sarvodaya School.

Would you like to provide an overview of the KMB Group?

The KMB Group is a diversified group with investments in retail, distribution and real estate. The group began in 1988 as a manufacturing company and soon grew to be one of India’s largest watch-strap manufacturers. Today, KMB has under its wing, leading companies in retail, distribution and real estate.

How would you describe the real estate industry scenario at present and future trends in the market?

While India continues to be among the fastest growing economies, the pace is unlikely to sustain unless it is supported by an equally robust development of its infrastructure.

costs, we f ind ways to prevent the exploitation of these resources through innovative methods.

Private equity (PE) investments in real estate in April-June quarter rose both in volume and value to $318 million. What does this trend by real estate companies indicate?

The opportunity provided by the real estate sector meets the appetite

occupants are in lag with global economic t rends, largely f rom outsourcing countries.

Which locations in India are hot property destinations for NRIs in 2013?

Delhi, Mumbai, Bengaluru and Chennai are key destinations for NRIs in my opinion.

Transparency is a grey area in the real estate industry. What is your observation on this issue?

There is a shift in the consciousness of discerning consumers and those developers that do not deliver a transparent process will be left out of the market

What has been the contribution of the National Real Estate Development Council to the real estate industry?

There is scope for embracing the voice of all stake holders in a multi-level engagement model, in order to compile solutions that would have a suitable impact on industry and the economy through an improved

solution to actual home users.

Would affordable housing projects drive the real estate industry?

Affordable housing is a misnomer in today’s conversation. 40-60 sq. mt homes are being built where required, the prices are a consequence of cost of land, FSI available, taxes indirect and direct.

If there is a programme that is successful in developing affordable housing, it is the model of public private partnership (PPP) being pract ised in Mumbai fo r SRS schemes. These could be, if widely applied, a solution to India’s housing needs and fuel the GDP.

The real estate industry is a key industry to which the growth of India’s GDP is directly linked. How can this link be reinforced?

All downstream trades and skills in the unorganized sector as well as cement and steel, impact 60 per cent of India’s GDP Basket, and can contribute up to 22 per cent of

India’s GDP growth if shepherded appropriately.

Which are the infrastructure projects the company has delivered in recent times?

Nirmal Estates, Industrial Estate, in Goa.

What structural approach do you take in developing and delivering real estate projects?

KMB evolves suitable solutions to local challenges, and participates in jo int development and joint ventures, for appropriate locations and properties, delivering enhanced value to land owners through its unique approach to value creation.

What future roadmap have you drawn for the company’s growth and expansion plans?

KMB plans to develop Grade A developments in the Mixed Use space.

What current projects have you undertaken in housing, retail and hospitality segment?

La Palazzo Outer Koramangala has 92 upscale apartments, 120,000 sq. ft. of signature office spaces and 40,000 sq. ft. of lifestyle retail complemented with 17,000 sq. ft. of fine dining. This short of a million sq. ft. project is underway and construction is in full swing. In addition, KMB is evaluating several JD projects on Sarjapur Road and Kanakpura Road for appropriate homes and mixed use.

The concept of a construction industry council for the seven Saarc countries was mooted by Sri Lanka in 1999 to fight for their rightful place in the international construction industry. All Saarc countries have similar problems. What should India do?

India needs to get its own act together; benchmarks for world-class approach to all segments of the market are already available. It needs suitable gravitas to get the appropriate solutions out of the door and into the real world.

REAL ESTATE

The real estate sector in India assumed greater prominence with the liberalization of the economy, as the consequent increase in business opportunities and labour migration led to rising demand for commercial and housing space.

The Indian real estate sector’s contr ibut ion to GDP has since declined from 10.6 per cent in the year 2010-11 to 6.5 per cent in the year 2012. Traditionally, Indian real estate has been dominated by a number of small regional players with low level of expertise and financial resources.

However, with the right offering for the right customer, I believe players today find the current industry state manageable. It is important to note that the impact uncertain times have on the real estate industry could often be considered as an opportunity for the ‘prepared’ buyer.

You are a promulgator of clean environment and green initiatives. How have you expressed this concern in your construction projects?

Al l ou r p ro jec ts a re g reen buildings, even more, we apply blue thinking. Less is more, in case we can eliminate the need to apply resources in terms of fixed assets or operating

of PE Investors, and signals a weak money market for a sector which forms the backbone of the Indian economy. 318 M is a paltry sum compared to investments in SE Asia markets, India can do much more.

How necessary is setting up a stock exchange allowing exclusive trading in real estate-based mutual funds for the growth of the sector?

This is the need of the hour and provides a safe and regulated investment avenue for India’s small investors who are obsessed with gold as the only asset class that meets their safety requirement. A proper approach on listing RE funds in the stock markets may well help route the savings from an unproductive gold investment which is hurting our BoP to our most productive sector with a high multiplier effect to our economy.

How would the introduction of real estate investment trusts (reits) for free trading in real estate shares kick-start the sector in India?

It is long overdue!In what way do global economic

and financial conditions have a major consequence on commercial real estate market?

Occupancy and qua l i t y o f

KMB Estates (2006), a division of KMB Group (1988), focuses on developing real estate projects from land identification to inception, design, construction, financing, marketing and final occupation. It has explored themselves in terms of residential, commercial as well as rental properties. They extensively use Information Technology for planning in real estate, as well as innovate to benchmark real estate developments to global standards. The Family pioneered real estate development in Mumbai in the 1950s from Khar to Marine Drive, and also founded the National Hospital (now Hinduja).Ramesh S. Bulchandani , Chairman, KMB Group, Bengaluru, shares with Dilip Phansalkar an overview of KMB Group, future roadmap, the industry scenario and future, green initiatives, investments, transparency, affordable housing and so on.

September 02-08, 2013 23

24September 02-08, 2013

‘GIFT City would be India’s first global financial hub’

INFRASTRUCTURE

GIFT will provide great impetus by bringing various national and multinational companies to Gujarat. GIFT will help Gujarat to develop services sector which will eventually help in balancing the economy. It will generate lot of high end jobs along with demand for various social and residential projects.

As per Mckinsey study GIFT will contribute around Rs 4,000 crore per annum to the state government and around Rs 700 crore to Central government in the form of taxes. It will have multiplier effect for the economy with the demand of housing, car, commercial, social requirements to make the demand of the city.

Tell us about the infrastructure development planned in GIFT. What is the area wise segregation of p lanned commerc ia l and infrastructure developments?

GIFT is implementing next class infrastructure facilities and few of them are first-time introduced in India as per international standards. The unique infrastructures implemented in GIFT City are as follows:

D i s t r i c t C o o l i n g S y s t e m ; Automated Solid Waste Management; Water Infrastructure (Zero discharge city); Power Infrastructure (99.999% reliability); Multi-Level car parking; I n f o r m a t i o n C o m m u n i c a t i o n Technology

GIFT City comprises 62 million sq. ft. (BUA) to be developed in three phases of around four years each and overlapping each other with targeting to completion in 10-12 years, out of 62 million sq. ft. of BUA, 67per cent is commercial, 22 per cent is residential and 11per cent is social development.

Give us an estimate of the investment planned for these developments. What is the route for procuring funds?

The investments planned for the aforesaid development can be broadly divided as follows:

Infrastructure – around Rs 10, 000 crore (to be developed by GIFT)

ICT & Data Centre – around Rs 5,000 crore

Building construction – around Rs 40,000 crore (to be developed by developers)

Building interiors -- around Rs 23,000 crore

Therefore the total project cost will be around Rs 78,000 crore

The infrastructure cost would be funded by the sale of development rights, debt and equity.

Propelled by a competitive economy anchored on commerce and related industry, how is GIFT, envisaged as an Eco-City, environmental-sensitive growth with equity?

GIFT City planning provides for integrated development. It would have development spread across commercial, residential, social. In the entire city no manufacturing activities will be permitted and it will be a hub for service sector.

All the infrastructure chosen for the development are based on the green city and environment friendly technologies. The development in GIFT City is based on vertical theme, thereby keeping 60 per cent of area will be green. GIFT City will have world-class ICT platform which will provide fast and reliable network for the business community.

How do you comply by the statement smart and sustainable cities? Tell us about the developments involving intelligent factors of construction? What new features are you planning to introduce?

The entire ICT master plan has been developed by British Telecom on the concept of smart and sustainable city. The ICT platform and networks which will be provided is attached at annex 1. The various features are summarised as below:

Eco-friendly development; energy-efficient infrastructure and built environment; strong public transport network and pedestrian friendly environment; integrated and multi-modal transport infrastructure; quality urban life; efficient utilization of resources; economic development - employment generation; integrate development in and around GIFT; node development concept in land use planning with city level green open spaces.

GIFT City, Gandhinagar, Gujarat, has become a global business hub and is attracting a large number of delegations and business visitors. It aspires to cater to India’s large financial services potential by offering global firms a world-class infrastructure and facilities which aim to attract top talent in the country by providing the finest quality of life -- all with integrated townships. Ramakant Jha, MD, GIFT City, discusses his plans, aspirations and further developments on this mega scale venture with Remona Divekar. GIFT is developing a Global Financial Hub in Gandhinagar and expects many international and national players in financial services and IT/ITeS to have their offices. Excerpts:

What is the primary objective to have GIFT City? What impetus would it generate for the state?

T h e p r i m a r y o b j e c t i v e o f establishing GIFT is to develop India’s first global financial hub. The study undertaken by renowned consultant (Mckinsey) has estimated that f inancial services sector’s contribution will reach around 15 per cent of the GDP by 2020 compared to 5 per cent of GDP. This would generate around 10-11 million jobs in India. GIFT will generate around 1 million jobs (5 lakh direct and 5 lakh indirect).

Consistent with the objective of developing a global financial hub GIFT is developing world- class infrastructure (Information Communication Technology, District Cooling System, Automatic Waste Collection System, Power, Water, Roads, etc.).

Gujarat International Financial Tec-City (GIFT City) will have the country’s first public District Cooling System (DCS), the work for which is already commenced. DCS is a highly energy- efficient system that provides air-conditioning in various zones of the city. DCS cools multiple users through underground piping network applying environmental friendly energy sources like central chilling plant.

DCS has fundamental cost and space saving advantages with energy efficiency, including load diversity, optimized operations, advanced technologies and better staff economies. It adds on extra floor space and enhances aesthetic sense of the buildings. It reduces capital investment required for additional power generation, transmission and distribution infrastructure.

Among various technologies ava i lab le wor ldwide for u t i l i t y services such as power, water, solid waste collection & management system, cooling system, etc; the most appropriate system was to be selected on the basis of efficiency, operating and maintaining cost and environment friendliness.

GIFT DCS is designed to run 24x7, providing the most reliable cooling technology available. GIFT district cooling uses environment friendly refrigerant which will have significant reduction in CO2 emissions, thus enabling building owners to achieve advantage towards green building ratings.

September 02-08, 2013 25INFRASTRUCTURE

Integrated infrastructure and technological intervention to ensure reduction in usage of energy and resource - Water, Power, DCS and AWCS; residential developments for all income groups; City level social infrastructure such as school, hospital, club, hospital, etc. being developed; intelligent and green buildings; quality urban life to make city environment more people friendly; C4 (Centralized Command & Control Centre) which will monitor various utilities of the building for providing effective O&M system.

What are the plans for the viable infrastructure connectivity in terms of transportation facilities that can be made available to the people?

GIFT will promote public transport with a vision to achieve 70:30 ratio (70 for public and 30 for private). GIFT has good external connectivity such as: MRTS (4 metro stations is planned inside GIFT); BRTS; connecting entries to GIFT with 8 lane roads.

Apart from public transport, a multi-level car park (60,000 cars) has been planned to accommodate parking requirement of the city.

Gujarat International Finance Tec-City (GIFT City) will get India’s first Business Club in Gujarat. What is the USP of this club?

In India, as of now, there is no business club concept and the need for a separate club covering business activit ies has been in demand since long. The club has been planned on the theme of business & entertainment.

It will have premium meeting, recreational and socializing facilities created to cater most elite business community in India. It will be ‘home away from home’ and also be ‘office away from the office.’ The club will provide the much-needed networking platform that the growing business community needs in Gujarat and India.

Are there any specific income group targets for GIFT in terms of returns of investment model? Which options are more viable for finalizing financing options -- the PPP model or financing mechanism?

GIFT will target financial services community based nationally and internationally for their operations in GIFT City. The target businesses segment are as follows:

Nat iona l f i nanc ia l se rv ices operations’ hub; regional/functional headquarters for financial services players; national headquarters for players; private banking hub for NRIs/regional HNWs; international microfinance hub; international commodity trade hub; global hub for IT services for financial services sector.

The USP of GIFTY City is to provide world-class infrastructure with emerging technology for the business community.

Which sectors are touted as maximum employment-generating models? What are the plans to further strengthen them?

The financial services sector has potential to generate 10-11 million jobs in India by 2020. In order to enable the financial services sector to grow in GIFT City, it is developing an integrated global financial hub.

Recognizing the potential of the state as a centre for the financial services industry, how has the government of Gujarat formulated GIFT to realize the vision of expansion as a self-sustainable city?

Recognizing the potential of the state as a centre for the financial services industry, the government of Gujarat formulated GIFT to realize this vision. The land of Central Finance Business District (CFBD) will subsequently be expanded and

surrounded by institutional areas, knowledge parks and integrated townships.

The CFBD is presently implemented in 886 acres of land. The project is an ideal blend of high quality residential, commercial and social facilities that optimize land and real estate values, global connectivity and gen-next infrastructure.

The project has been globally benchmarked with international financial centres. GIFT envisages to become a hub for IT/ ITeS for financial services and other multi services sector. GIFT Project has potential to generate around 0.5 million of direct jobs and equal number of indirect jobs. While integrating their best features, GIFT also envisage creating high-quality city environment with world-class infrastructure. The project, thus, would set standards for sustainable business environment.

Propel led by a compet i t i ve economy anchored on commerce and related industry, GIFT, will serve as a vibrant hub of Western India and as a habitat showcasing family-oriented, environmental-sensitive growth with equity.

GIFT offers a unique opportunity to in ternat ional and domest ic operations in financial services in close proximity. The International Financial Services Centre (IFSC) and export-oriented services in a Multi Services Special Economic Zone (Sez) while area outside Sez will house domestic financial services along with residential, entertainment and social facilities ensuring vibrant business environment and quality life.

26September 02-08, 2013

Lure of EPC over PPP model for highway projects

PPP journey so farHighway p ro j ec t s i n I nd ia

amounting to 3,055 km were awarded through the EPC approach, during the 2005-2006 periods and this approach demanded appropriate cash flow from the government.

But this model rapidly lost its sheen due to insufficient government funds for infrastructure projects in the 10th Five-Year plan. This led to the increased adoption of the PPP approach as private players showed readiness to undertake investments on their own for the NHAI projects. This was seen from the award of projects through the Build-operate-Transfer (BoT) approach which was extensively used and a maximum of 6,491 km was awarded in 2011-2012.

Though the number of projects awarded fell under the PPP banner, the level of completion for these projects was at a mediocre level. Also, PPP project execution was introduced and adopted due to the following benefits on a project basis:a) Improved efficiency with respect

to project delivery, operation and management tasks.

b) Availability of additional resources to meet the growing needs of investment in the sector.

c) Access to advanced technology (both hardware and software)Also, state highway department

started adopting PPP methods much later than national highway as there was no central body like the NHAI or proper PPP policy at state level. Nevertheless, the PPP approach

CONSTRUCTION

was adopted by state governments amounting to 173 projects in the last six-seven years.

The NHAI road projects amounts to an investment of INR 1,55,328 crore which translates to 209 projects until 2012, out of which only 61 have been completed and remaining are in the process of construction.

PPP deters private contractors

The Ministry of Road Transport & Highways has decided to switch to Engineering, Procurement & Construction (EPC) approach to award new as well as complete stalled projects, from a currently non-viable PPP approach.

In addition to this, the 12th Five-Year Plan has proposed to accept EPC as execution method while awarding the construction of 20,000 km targeted during 2012-2017. Recently, the NHAI conducted the bid of 19 road projects and there was not a single private contractor who was ready to participate in a PPP process.

This shift in execution trend is being caused by the following chief reasons:a) The slow growth of the India

economy has eroded liquidity levels of players in the construction industry and this has made it difficult for PPP to be viable, presently. With the economy growing below the rate of 6% along with a high inflation rate resulted in higher interest rates due to which contractors faced difficulties in availing funds.

b) Private equity funds are also

scarce at this point of time in India as private investors are unwilling to consider investing at this point of time in construction owing to fear of non-returns.

c) Also, the delays caused in the approval of equity arrangements with the Finance Ministry and the Highways Department has led

for restructuring and the matter is currently required to be settled between the finance and the road ministries.

Road ahead for road projects – PPP again?

With respect to the construction of highway projects, the proposed

quality amidst local competition. A l though there has been a

decrease in the FDI in road projects, d i rect part ic ipat ion by fore ign contractors for project execution will increase in the near future.

The current change in execution from PPP to EPC will help developers and contractors buy some time until

Swathi Ilango Research Analyst, Beroe Consulting (I) Pvt Ltd

to poor contractor participation during bids. The NHAI has not been able to improve ease of access to finances for participating contractors.Most of the projects falling in

NHDP4, NHDP5, NHDP7 and SARDP NE have been stal led or being delayed due to the bad funding circumstances. The NHAI is in the process of monitoring 35 highway projects for financial stress and NHAI is requested by the Highway Ministry to bailout 25 premium stalled highway projects. The other less premium projects have the possibility of being scrapped or re-bid depending on the type of issue faced by the project.

The NHAI has been pushing for the premium restructuring proposal that will permit the private contractors or developers to realign their premium payments in order to shrink their financial strain on stalled projects. This Law Ministry was unable to pass judgment on the NHAI’s appeal

framework for EPC approach will cater to the timely construction needs for the rest of 2013 and into 2014. Unless there is substantial improvement in the performance of the Indian economy, the reinstatement of PPP is apprehensive in the immediate future.

Around 35 highway projects are already placed under observation for their uncertain future and the NHAI needs to gain the trust of the finance ministry so as to help obtain a chance for financially strained developers to fulfill their bid commitments.

Also, any alliances with foreign i n v e s t m e n t o r i n f r a s t r u c t u r e companies for acting as junior or senior partners in large scale projects (above Rs 5000 crore) should be encouraged. Many infrastructure projects are attracting Spanish contractors into India as some of these European economies are badly affected and these foreign contractors provide cutting edge

they can regain their cash flow and improve their confidence levels in undertaking large PPP highway projects. With the simplification of exit policies for the concessionaire/contractor in the anvil, EPC approach should ultimately give way for PPP model again in the coming few years when more infrastructure projects will be announced for awarding.

Additionally, the government’s orderly and supportive measure to remove obstacles for the speedy implementation of highway projects will be a major onus for this sector.

September 02-08, 2013 27INFRASTRUCTURE

Bechtel unveils innovative port design in Africa

Multi-User offshore hub offers significant

advantages over traditional ports

Bechtel, the global engineering, c o n s t r u c t i o n , a n d p r o j e c t management company, has created a revolutionary design for ports that could transform shipping in Africa. The Multi-User Offshore Hub is designed for two or more users and consists of an offshore, smart terminal arrangement and docking system that can accommodate oceangoing vessels and barges.

The Multi-User Offshore Hub has the potential to open new market opportunities for African ports by significantly increasing capacity and substantially reducing port construction and operation costs.

“As existing African ports become more and more congested, increased capacity is an urgent need for both the import of consumer goods and the export of minerals. Each requires out-of-the-box solutions to handle as many containers as efficiently as possible and to speed the provision of new mineral export facilities to enable the region to develop its economy,” said Marco Pluijm, Bechtel’s senior ports specialist, who unveiled the Multi-User Offshore Hub concept on August 26 at the African Ports Evolution 2013 Forum in Cape Town.

“This solut ion could provide a reduction of up to 40 percent in port infrastructure construction costs compared with building a traditional port and up to 50 percent in operational cost savings as the hub can handle much larger Capesize and Valemax vessels, which result in economies of scale.”

The Multi-User Offshore Hub concept combines a country’s existing transport modes, such as rail and river barges, to provide the most efficient and sustainable logistics possible. Bechtel is currently identifying suitable sites for a Multi-User Offshore Hub in countries in both East and West Africa.

The Multi-User Offshore Hub concept builds on Bechtel’s ongoing commitment to improve shipping capabilities in Africa.

The company is also leading a three-year joint-industry research project to improve the safety of mooring large cargo ships off the coast of West Africa. Both initiatives are instrumental in upgrading and expanding port infrastructure needs in Africa. The two initiatives are part of Bechtel’s longstanding work in Africa, which spans more than 70 years.

Bechtel is a global leader in the research, design, and construction of port and marine projects. The company has successfully completed more than 80 port and marine projects across the world, 28 in the last decade. These include Jubail Port development (part of Jubail Industrial City) and Khalifa port and Kizad, which has the first semi-automated container terminal in the Middle East.

Bechte l is among the most respected engineering, project management, and construction companies in the world. We stand apart for our ability to get the job done right—no matter how big, how complex, or how remote.

Bechtel operates through five global business units that specialize i n c i v i l i n f ras t ruc tu re ; power generation, communications, and transmission; mining and metals; oil, gas, and chemicals; and government services.

Since its founding in 1898, Bechtel has worked on more than 22,000 projects in 140 countries on all seven continents. Today, our 53,000 employees team with customers, partners, and suppliers on diverse projects in nearly 50 countries.

Marco Pluijm, Bechtel’s senior ports specialist

28September 02-08, 2013INFRASTRUCTURE

Independent authority to oversee e-ways The Planning Commission has

proposed for an independent body to oversee the development of expressways in the country, raising objections to the clearance given by the highways authority to create a separate vertical for the purpose under its purview. Creation of an independent expressway authority was part of the 11th Five-Year Plan.

However, the Road Min is t ry has decided to set up a dedicated expressway cell to push the eastern peripheral expressway and two new projects—the Mumbai-Vadodara E x p r e s s w a y a n d t h e M e e r u t Expressway.

The NHAI board approved a proposal to set up a separate vertical to look at expediting development of expressways. The vertical would be in the form of a company or corporation and would be headed by the NHAI member in-charge of public-private partnerships. According to the Road Ministry, keeping the expressway cell under the NHAI would enable it to draw on the highway authority's kitty.

Besides, the NHAI has the requisite human resources and potential to raise additional funds and the subsidiary could operate smoothly within the legal framework available under the NHAI Act. The plan panel

is believed to have objected initially to the Road Ministry's equity take-out proposal that would allow financially stressed developers to sell their entire stake in highway projects.

It also objected to the proposal to allow concessionaires to defer premium payment in case of undue financial stress. The two bodies are also divided over pursuing over Rs 16,000 crore Delhi-Jaipur expressways-—while the plan panel believes it should be fast-tracked, the ministry feels it should not be given preference over other expressway projects since it is not workable on the build-own-transfer model and

Pune-Solapur road by IL&FS ahead of scheduleIL&FS Transportation Networks

Ltd said that it had completed its Pune-Solapur Road Project over four months ahead of schedule. The provisional completion certificate was issued by the National Highways Authority of India. The company has commissioned the project 145 days ahead of scheduled project completion date.

The agreement for the project was

signed on September 30, 2009 and financing arrangement for financial closure or tying up the necessary capital for it was done on January 25, 2010.

The road is 101 km long with a cost of Rs 835 crore. The construction per iod was set at 30 months. The project is on toll basis with a concession period of’ 19 years and 295 days comprising of tolling and

would require innovation in terms of financial modeling to make it viable.

In July this year, Prime Minister Manmohan Singh said the Eastern Peripheral expressway, along with other key infrastructure projects, would get focused attention. He directed that the much-delayed 192-km eastern peripheral expressway be fast tracked by the road ministry with assistance of the Planning Commission deputy chairman. Although the 11th Plan had proposed 18,000 km of expressways to ease traffic congestion on the national highways, little progress has been made.

operations and management period of 18 years added the exchange announcement. This would mean that the company can collect toll on the

project for 19 years and 295 days but with the responsibility of maintaining and managing it for 18 years.

Eight developers to surrender Sezs

As many as eight Sez developers have approached the government to surrender their projects, while 13 players have sought more time to execute their plans despite the Centre's recent incentive package to revive investor sentiment for such zones. These requests will be considered by the 19-member Board of Approval (BoA), Chaired by Commerce Secretary S. R. Rao, at its meeting on August 30.

Those who have asked for more time to execute their projects include GMR Hyderabad International Airport, DLF Info Parks, Parsvnath Infra and Ansal Colours Engineering. The BoA has granted formal approval to GMR Hyderabad International Airport Ltd to set up a zone for multi services with international financial services centre

at GMR Hyderabad International Airport (GHIAL), Shamshabad, Hyderabad.

"The Sez is yet to be notified. The developer has already been granted three extensions. The validity of the last extension was up to June 24, 2013. The developer has requested for further extension of the validity period by one year on the grounds of time lack in seeking GHIAL lenders clearance on the land earmarked for Sez, lack of demand, etc," the BoA agenda said. DLF Info Parks has asked for more time for its IT zone in Pune. Similarly, Parsvnath Infra Ltd has sought one more year for its IT Sez in Ernakulam. The developer has requested for further extension of the validity period by one year.

SREI arm’s Haldia project delayed, but no cost push upNormally, delay in implementation

escalates project cost. But Kolkata-based SREI Group-controlled Rs 660-crore DPSC Ltd claims to have used delays to their advantage. According to Chairman Hemant Kanoria, DPSC’s upcoming 3x150 mw coal-based thermal power capacity in Haldia in coastal West Bengal, which is now to be commissioned in early 2015 – two years behind the schedule — will not face any cost-push beyond the originally estimated Rs 2,475 crore.

The NSE-listed company, Kanoria says, renegotiated the contracts, taking advantage of the slowdown. Unlike majority of the idle generation capacities, DPSC has entered into

power purchase agreements (PPA) with the West Bengal State Electricity Distribution Company for part of the generation. The PPA even allowed the company to pass through the cost of imported coal.

Having taken over from the state-owned Andrew Yule in 2009, DPSC’s electricity sales increased from a mere 100 mw to 250 mw. This coupled with 99 per cent recovery (of sales), reduced 2.9 per cent transmission and distribution loss and phasing out of the archaic generation facilities improved bottom-line. The company was recently awarded the franchise for electricity distribution in Gaya in Bihar.

September 02-08, 2013 29INFRASTRUCTURE

E-govt clears 36 stalled infra projects worth Rs 1.83 lakh cr

The government c leared 36 infrastructure projects worth Rs 1.83 lakh crore that were stalled because of regulatory reasons in a bid to revive investments and perk up sentiment. The projects cleared include 18 in the power sector with investment of about Rs 85,000 crore and 18 others in sectors like road, railways, petroleum and natural gas.

The CCI (Cabinet Committee on Investment) met to look at a large number of projects. I t cleared projects with a total outlay of Rs 1.83 lakh crore. The big projects cleared by Prime Minister Manmohan Singh include Reliance Power 's 4 ,000 MW ul t ra-mega power project at Sasan in Madhya Pradesh, L&T's Metro Rail project,

Hindalco Industries project and Essar Power's Jharkhand project. In the Sasan pro ject , Stage-1 clearance or preliminary approvals have been given. When this is verified by the state of Madhya Pradesh and the promoter deposits the money further, clearances will be given.

Chidambaram said banks had already disbursed about Rs 30,000 crore for the power sector projects credit flow would begin once these projects start rolling. Disbursements would start as the approvals are

being given. Clearly the signal is projects are not being stalled.

S ta l led pro jects have been unblocked. Chidambaram said that another nine projects worth Rs 14,084 crore in sectors such as petroleum, roads, railways and steel have been reviewed and there are no pending issues with them. Banks have disbursed Rs 1,484 crore to these projects. The panel also extended the date for signing of fuel supply agreements between Coal India Ltd and power firms.

Reliance Infrastructure (RInfra) will receive entire investments of Rs 2,800 crore in the Delhi Airport Metro project, which it exited over a month ago. The company's Chairman Anil Ambani said, "The Delhi Airport Metro project has been handed over to DMRC and the process of arbitration has begun. According to the legal advice received by the company, we are confident of receiving our entire investments in the project".

RInfra terminated its contract for the project citing DMRC's failure to cure substantial defects in civil structure

The Cabinet Commit tee on Inves tments (CCI ) has asked the Ministry of Road Transport & Highways to submit ‘quickly’ its proposal that allows developers of highways to defer the payment of premium they had promised at the time of bidding for the project.

T h e m i n i s t r y h a d i n v i t e d comments from other ministries, will now present the note on premium restructur ing to the committee next week. The Road Ministry has included in the note the option to cancel the projects. The CCI has directed the ministry to bring the item (the premium restructuring note) quickly. The note was circulated in the Law Ministry, Finance Ministry, Department of Economic Affairs and the Planning Commission.

The Road Ministry had also launched an exercise to determine if the toll revenues were exceeding the premium promised in about 20 premium-based projects that are believed to have benefitted from the proposal.

This was being done to analysis whether the developers were indeed facing financial stress and if the premise for deferring the premium payment was still valid. However, the Road Ministry officials said it is unlikely they will go through with either of the exercises given the urgency of the demand from the CCI.

The National Highways Authority of India has been pushing the proposal in the belief that relieving developers of financial stress would help revive the sector. The proposal has been passed around between ministries since it was formulated earlier this year.

The Law Ministry rejected it on the grounds of legal and constitutional infeasibility, after which the road ministry referred the matter to the CCI. The committee also did not support the proposal cit ing the objections raised by the law ministry. In July, the Law Ministry backtracked on its earlier advice and instead said the matter should be resolved between the f inance and road ministries.

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RInfra to receive investment for Delhi Airport Metro

designed and built by them and on account of 'material breach' and 'event of default.’ The DAMEPL (Delhi Airport Metro Express), a subsidiary of RInfra, has claimed termination payment equal to 130 per cent of adjusted equity and 100 per cent of debt due for the project.

Meanwhile, Ambani also said that the Maharashtra Electricity Regulatory Commission has allowed RInfra to recover Rs 925 crore of arrears every year, aggregating Rs 5,550 crore over six years.

Road Ministry to restructure

premium for highway developers

30September 02-08, 2013

Wienerberger claims to be the world’s largest producer of clay building bricks. How would you like to exculpate the assertion?

W i e n e r b e r g e r i s t h e o n l y multinational producer of bricks, roof tiles, concrete pavers and pipe systems with a total of 221 plants in 30 countries and four export markets, including one plant in India.

No other company can boast of so many production units across the globe in this particular segment. We are the world’s largest producer of bricks and number one on the clay roof tile market in Europe. Furthermore, we hold leading positions in concrete pavers in Central-East Europe and pipe systems in Europe.

What efforts has Wienerberger made to establish itself as a global market leader in clay-based products?

The future of construction and infrastructure lies in energy efficiency, reliability and affordability. We offer the right solutions to meet these demands today.

W ienerberger has a s t rong financial base and a diversified product portfolio with a focus on quality and innovation. User oriented and innovative, comprehensive building material solutions for our customers form the basis for our sustainable success.

Research and development (R&D) form an integral part of strategic planning at Wienerberger and represent key activities for the Group. In these areas we work to optimize production processes and to continuously improve and develop our products and system solutions in all our application areas.

It is this dedication and research towards continuous development that has helped us achieve a pivotal position in the market.

How does your concept o f sustainability converts into visible results in green building solutions?

We view sustainabil i ty as an integral part of our business and an important factor for Wienerberger’s success. For these reasons, we have firmly anchored sustainability in our corporate strategy.

BUILDINg MATERIALS

departments to ensure that new developments always meet the needs of our customers. These activities are centred on the development of innovative products and system solutions for sustainable and energy-efficient construction.

All your productive activities are bound by principles of sustainability. Would you like to define the fine points of these principles?

Our wall solutions, roof solutions and façade solutions are all ceramic-based products, which are natural and long lasting. Clay as a building material is a source of natural strength with nil pollutants which promotes healthier living.

Our flagship product, manufactured in Kunigal plant Porotherm HP clay bricks are rated by the IGBC under following criteria:

Energy Efficiency: Lower ‘U’ values assure better thermal insulation, thus providing comfortable indoor climate – reduce energy demand for air conditioning. ‘U’ Value : 1.0 W/m²K

Material with Recycled Content: Raw material used is industrial waste or recycled materials – thus save on natural resources e.g. coal ash, rice husk, granite slurry, etc.

Regional Material: Factory to site distance < 400km

In addition we use de-silted clay from dead water tanks

The Energy Resource Institute (Teri) was established in 1974 with an aim to focus its activities and research in fields of energy, environment, and sustainable development, mindful use of natural resources, large scale adaptation of renewable energy resources and technologies and reduction in all forms of waste and its management.

Teri has also introduced Griha, a rating system to adjudge the ‘greenness’ of buildings, which has now been adopted by the Ministry of New & Renewable Energy, the Government of India as a national rating system.

Griha recognizes Porotherm HP & Porotherm thermo brick under the following:

What procedure do you follow to adopt conservation projects in the company’s plants?

The company follows certain policies & guidelines to continuously work on:

Energy conservationDedicated engineering team to

reduce emissionsBy building more green field

projectsBy implementing strict norms

on EHS (environment, health & safety) across the group companies worldwide

Reducing the brick weight without affecting the product quality --> this will conserve the natural resources (clay) + reduce the energy consumption for the production

Subst i tut ing the fossi l fuels by green fuels l ike bio mass --> most successful implementation in Wienerberger!!

Heat energy produced during the firing of the kiln in bricks is taken transferred to dryers & pre-heater, which enables us to completely utilize the energy.

What kind of production process does the company implement to continuously recycle heat and energy?

We do continuously recycle the

‘Environment protection in production top priority for Wienerberger’

A house made of Wienerberger building materials is an investment for coming generations. The core of our sustainability strategy is the long service life of our products. At the same time, we implement measures to reduce the environmental impact of our production processes.

Our activities are focused not only on reducing energy consumption, but also on improving our ecological footprint by using fewer raw materials and increasing the use of recycled products.

The sustainability of our products is underscored by their long service life. Outstanding technical properties are another exceptional feature: ceramic building materials are free of pollutants. They not only provide good thermal insulation, but also protection against noise and fire, and create a healthy, comfortable indoor climate.

We are convinced that sustainable m a n a g e m e n t c r e a t e s a d d e d value for all our stakeholders. In order to establish and maintain positive relations with our investors, the media, suppliers and other stakeholders, we follow a policy of

transparent communications and active dialogue.

Invitations to our plants and the regular exchange of information provide a platform for interaction with neighbouring residents in many countries. We want to be a fair neighbour who not only meets but also exceeds legal regulations to provide quality living for local residents.

Right from procuring raw materials, to the production methodology and the products that we offer, are all bound by principles of sustainability. Some of the initiatives in this respect include:

Di-silting of clay tanks; Use of locally available products; Use of waste products from other industries. Efficient use of biomass & other environmental- f r iendly fuels in manufacturing.

Apart from these, we continuously recycle heat & energy in the production process and systematically adopt various conservation projects in our plant on a regular basis.

Wienerberger products (Porotherm HP, Thermobrick) have been rated by the Indian Green Building Council

(IGBC) & GRIHA (Green Rating for Integrated Habitat Assessment) developed by Teri (The Energy & Resource Institute) -- two of the premium organizations dealing with green building in India.

Wienerberger’s commitment to sustainability is reflected in the cont inuous improvement of i ts production processes. A central engineering department for bricks is working, above all, on projects to reduce energy consumption.

Drying and firing comprise a significant amount of the energy requirements for our production

Wienerberger AG, founded in 1819 and based in Vienna, Austria, is the world’s largest producer of bricks, number one on the clay roof tile market in Europe and holds leading positions in concrete pavers in Central-East Europe. The company was set up in India in 2006, with head office in Bengaluru. It has a state-of-the-art unit in Kunigal, 70 km from Bengaluru. It produces Porotherm clay bricks (first time in India), with a capacity of 120,000 tons (100 million brick units) per year.In th is in teract ion, Monnanda A p p a i a h , M a n a g i n g D i r e c t o r, Wienerberger, shares with Dilip Phansalkar the company’s commitment to sustainability, safeguarding environment and energy conservation. Excerpts:

and many assignments therefore concentrate on optimization in this area. Other focal points of our research include resource conservation in production and the responsible processing of raw materials.

Another bu i ld ing b lock fo r Wienerberger’s sustainable success is the continuous development of the product portfolio and the improvement of existing products. Wienerberger operates three research centres for bricks that are specialized by product group: clay blocks, facing bricks and clay roof tiles.

O u r p r o d u c t m a n a g e m e n t specialists work closely with the va r ious marke t i ng and sa les

Wiener Facility 2 Wiener Facility 1

Wiener Facility 3

September 02-08, 2013 31BUILDINg MATERIALS

energy by various methodologies and by adopting in-house technical expertise such as:

Recovering the waste heat from the kiln and using it for drying the bricks instead of burning fuel for generating the hot air.

Developing the advanced drying programs with special effects to reduce the drying time.

By using recycled solid wastes like coal ash with the basic raw material clay and inducing the thermal energy in the brick to ensure lesser energy consumption in the production.

By using other suitable additives (solid wastes) like rice husk, granite slurry, stone slurry, workability of the clay blend increases, thereby reduction of thermal & electrical energy consumption.

What kind of machinery and equipment is used in making Porotherm bricks, and Koramic and Argeton tiles?

Currently we are manufacturing Porotherm horizontally perforated clay bricks in Kunigal, Karnataka. Argeton & Koramic are being manufactured in our European production facilities and are imported from Europe.

The factory in Kunigal, Karnataka is a fully automated, state-of-the-art facility manufacturing Porotherm horizontally perforated clay bricks. With a capacity over 100 million brick units per annum, it is one of the biggest units of its kind in Asia.

The production in this facility is environment-friendly, and runs 365 days a year irrespective of weather conditions. All this has been achieved because of advancement in automation and their adapting to local conditions.

A classic example of an industrial robot is Fanuc Robotics’ Intelligent M-410iB Robot we are currently in our production unit in Kunigal. The M- 410Ib series is Fanuc Robotics latest-generation palletizing industrial robot.

Industrial palletizing refers to loading and unloading parts, boxes or other items to or from pallets. Automated palletizing refers to an industrial robot palletizer performing the application automatically.

This Robot is 4 axis robots. It is ‘Pick & Place’ type robot which can handle 450 kg of weight including gripper. Currently we are using 6 robots of the same kind, total brick handling is done by these robots.

In our current operations we use one robot for green bricks and use four robots for dry brick handling. Additionally one robot is used for fired brick handling. These robots communicate with Siemens S7-300 PLC via ‘Profibus’ and are programmed for all variants of our products and will hence automatically adjust the pick & place position according to the product size and specification.

These automated machines not only carry out a complex sequence of operations, but are also extremely flexible in terms of controls. They are self-regulating, correcting themselves as they go, achieving precision production, larger volumes and at the same time maintaining a safe and healthier work environment.

What are the benefits of Porotherm bricks, and how economical is their application in high-rise structures?

Salient features of Porotherm:Porotherm HP is big in size Porotherm HP 200 is equal to

8.46 bricks i.e. approx 9 bricks (230x110x75mm)

Less mortar joints – less mortar consumption, hence less plumb & alignment

Faster const ruct ion – more product iv i ty ; l ightweight : 60% less in weight; ease of handling; transportation; saves labour; Less dead load, savings in steel & concrete; precision on brick size and surface; savings on mortar; line and leveled plaster surface; low ‘U’ Values – 1.0 W/m²K; better thermal insulation = less energy loss through walls; savings on energy consumption; comfortable inside temperature;savings on steel and concrete cost; faster construction & ease of handling at site

What is meant by the term ‘Porotherm’?

The word ‘Porotherm’ has been coined from a combination of two words: Porous meaning porosity in the clay matrix which is an inherent property of the clay and ‘Therm” means Thermal insulation, or in other words ‘Porous to provide better thermal insulation’.

What are the raw materials used to manufacture the bricks and tiles, and from where are they procured? How do the products fulfil the need for thermal insulation, sound insulation, fire protection and a pleasant indoor climate?

Both bricks & tiles are made from clay. But tiles are imported from our European factories; whereas the Porotherm horizontally perforated c lay br icks are manufactured locally, keeping in mind local market conditions.

Made from natural clay, Porotherm products provide a healthy and comfortable living environment with a complete absence of pollutants and without sacrificing thermal efficiency. With a breathable structure that facilitates climate control, they create healthier living conditions.

With high thermal mass and accumulation properties, Porotherm evens out temperature variations through thermal capacity effects, to protect against cold in winter and ensure a comfortable and healthy room in summer. In addition, their low moisture retention and fast drying properties optimize thermal protection, whilst gradual release of stored passive solar energy reduces heating & cooling costs.

Offering outstanding ecological balance, Porotherm products are made to minimize environmental impact both in manufacture and assembly. They are made from natural clay, and often include coal ash and sawdust which burn out during the manufacturing process. And with a life expectancy anticipated to be over 150 years, Porotherm offers the ultimate in high performance, sustainable construction.

What structural strength Porotherm bricks possess against natural calamities such as earthquakes or floods?

Porotherm HP clay brick has a strength of 3.5 N/mm2 when tested as per specified procedure in IS 3952 – the Indian Standard for burnt clay hollow bricks for walls and partitions.

The bricks are to be used as non-load bearing walls, when we say it to be non-load bearing walls it is used in framed structures made up of RCC Concrete and in case of natural calamities it is the building frame which needs to resist the anticipated loads of certain magnitude.

How critical are sustainability goals and environmental protection in production of eco-friendly products?

Envi ronmental protect ion in production is a top prior i ty for

Wienerberger. The use of natural raw materials and recycling are the central principles of our sustainable production. Another important focal point of our activities is the greatest possible conservation of resources.

That means improving the energy efficiency of production processes through optimized technologies and the use of renewable energy carriers and, subsequently, reducing CO2 emissions. We are also working to reduce the weight of our products and evaluating the use of secondary raw materials.

W i e n e r b e r g e r h a s d r a w n an investment plan for phased expansion of its Kunigal factory. How will it meet requirements of a fast-growing market of Porotherm bricks, and the tiles?

What are the extraordinary qualities that make Porotherm bricks and the tiles so special?

The bricks are large in size quite similar to the blocks commonly used nevertheless they are 60 per cent lighter in weight, thus making optimization avenue in the structural design.

The lightweight is also beneficial for the masons constructing the walls as they are energetic enough to provide additional productivity.

Water absorption is less – thus ensuring the integrity of the product under adverse climatic exposure.

Thermal insulation is very good thus ensuring comfortable indoor c l imate , w i th low demand on artificial conditioning of the indoor atmospheres.

Strength compared it suffices the design requirements for a non-load bearing wall.

How widespread and popular is the use of Porotherm clay bricks in Karnataka, Tamil Nadu, Kerala and Andhra Pradesh? What makes them so suitable for climatic conditions in those states?

Today the br icks are be ing accepted across regions by many reputed and we l l -es tab l i shed players of the market, the special consideration is against its high insulation properties the ‘U’ Value which is 1.0 W/m2K, the warm and humid c l imate zones f ind it very suitable as it keeps their indoors comfortable during extreme summer.

There is common bel ief that constructing green bui ldings involves high spending. What is your point of view?

A Green building is more of a well-planned and appropriately oriented building, with due consideration for selection of the material.

Today’s market scenario, due to extra awareness of green products, is increased demand for green products and hence there are multiple players providing various solutions to facilitate green concepts.

W i th increased players and strong competition the incremental cost is as low as just 5 per cent, this also depends on the selection of the products and the aesthetical considerations provided by the owner.

What awards has the company r e c e i v e d f o r o u t s t a n d i n g international brick architecture?

Launched in 2004, the biennial W i e n e r b e r g e r B r i c k A w a r d recognises innovative and creative brick bui ldings of internat ional quality and their architects.

The globally outstanding buildings constructed using clay products are submit ted by internat ional architecture critics and architecture journalists. The worldwide research conducted by these ‘architecture scouts’ helps Wienerberger identify brick buildings that leave a lasting impression. Possible applications range from building solutions with classic wall and façade bricks to the creative use of roof tiles and clay pavers. Special attention is paid to how the building blends naturally into the surroundings as well as to the geometry, personality and quality of the building and its lighting conditions.

This is a bi-annual award and for the year 2014, the winners will be selected by a jury of renowned experts consisting of architects Plamen Bratkov (Bulgaria), Rudolf Finsterwalder (Germany), Hrvoje Hrabak (Croatia), John Foldbjerg Lassen (Denmark) and Zhang Lei (China).

In 2010, Anagram Architects from India had won the second prize for their project South Asia Human Rights’ Documentation Centre in New Delhi.

8” inch block Weight DensityPorotherm HP 11.1 kg 700 kg/cumSolid concrete > 32 kg 2,000 kg/cumClay brick ~ 29 kg (@3.2kg/brick) 1,800 kg/cum

32September 02-08, 2013

What are the investment opportunities available in India amidst growing interest in the region’s property market?

Property continues to be a good investment option for investors. The stock markets, gold, currency markets are currently undergoing tremendous volatility. In addition to stability, residential real estate investment offers the additional opportunity to obtain a mortgage on the home thereby offering the opportunity to lever up the investment.

T h i s h a s t h e p o t e n t i a l t o boost returns substantially where appreciation exceeds the interest rates. All cities and submarkets however, are not delivering the similar returns. Investors need to do their due diligence on the particular submarket before making an investment.

In today’s times, the interest in property development is surging with demand ratio on a higher note. What is the outlook for the futuristic path of succession, accounting for global real estate transactions? What volumes of growth can be expected this year looking at the Indian realty market?

The Pune residential market continues to show resilience amidst a negative economic environment at a macro level. At a local level, the fact that developers have launched projects in more numbers than ever before and the fact that the percentage of stock sold continues to be stable indicates that there is a high demand from homebuyers. The price increases have also tapered off marginally in line with the reduction in inflation over the last 6 months.

The Indian real estate market size is expected to touch $180 billion by 2020. Foreign direct investment (FDI) in the sector is expected to increase to $25 billion in the next 10 years, from present $4 billion. Demand is expected to grow at a compound annual growth rate (CAGR) of 19 per cent between 2010 and 2014, with tier 1 metropolitan cities projected to account for about 40 per cent

REAL ESTATE

‘Momentum in real estate will pick up throwing open more investible options’

of this. In the Indian realty market, looking

forward we believe that the next 12 months have more risks than the last few years on account of the impending national elections as well as the macro economic situation.

We also expect the cost structures for developers to be negatively impacted on account of the Real Estate Regulation legislation that is currently being considered by the government. The draft in its’ current form will lead to a price rise – this is a fallout of the populist move by the government to regulate developers and the effect of price rises for the home buyer can be considered collateral damage

Also, where the domestic markets are concerned with the various tightening policies in place and market sent iment remaining cautious, will there be a drop in activity in both the new home buying segment and resale markets? What is your take?

Given the current domest ic

markets and the various contributing factors, the laws of economics will be applied. If we artificially choke up the supply and approval process takes a long time, the demand supply gap will not be bridged. This in turn will lead to an increase in prices.

The problem however is the lack of momentum in the economy. With a slowing economy, and high mortgage rates, affordability of the home buyer is adversely affected. As a result, we will see either reduced profitability for developers (maintaining volumes at lower prices) or lower volumes (lower volumes at higher prices).

The Gera Realty Report Pune for the period December 2012 to June 2013 highlights a significant infusion of supply in the form of 494 new projects alone adding 27,008 units. This led to the Pune Realty market expanding by 20.30 per cent from December 2012 to June 2013 (as against 12 per cent in the previous 6 months).

Of the total stock, 79.5 per cent is currently sold out. All in all this is a

significant expansion of the market. Even with substantial supply being added, the market continues to show remarkable stability in terms of sellout – the average unsold stock has remained steady in the range of 21 per cent since June 2011.

It is interesting to note that on one hand there has been a consistent shift towards catering to the high end segment of the market, however, the shift is more in the 3 & 4 bedroom segment.

The Pune Realty Market is in an expansion mode with more premium homes being launched. On analyzing the price points across the market, there is a clear trend of larger apartments sel l ing at higher prices.

On the other hand, the micro markets have witnessed the maximum increase in prices over the last 24 months. We have however seen the impact of reducing rate of price rises in the last 6 months.

H o w i s I n d i a s e t f o r n e w breakthroughs when the Indian

metros are becoming enormously expensive and the interest rates of bank loans are already proving to be a stumbling block which may rise further with the revision of RBI norms?

Yes, the markets are affected by the various factors mentioned, but people will continue to be in the metros and will also drive the markets there because of the ample job opportunities.

Everyone wants to live closer to their respective work places and places where lots of job opportunities are, and therefore, the only solution to this would be to create job opportunities in the Tier-2 and -3 markets.

Until we do so, people will continue to rent places in metros and buy houses away from their work places. The shift to mini metros and Tier-2 and -3 markets will be seen when there will be a marginal increase in opportunities in these areas.

The drop to the volatility in the market, slower growth of the Indian economy, political stalemates and depreciation of the rupee are a few concerns grappling the Indian economy. What impact is it likely to have on the future run of realty projects?

All these factors are affecting the economy as a whole. The real estate sector is no different and does not exist in isolation. It will also be impacted and the economy and political stalemates are hurdles to clean up the system and get faster approvals. Laws which can lead to practical implementation should be formulated. Laws need to be enforceable and for that the parameters governing the law need to be clearly defined and in tandem with reality.

Despite the opportunities, the prevailing global and local market conditions have adversely affected the real estate sector. The recently tabled real estate bill in theory is a much needed tool to help regularize and stream line the sector, however in

Gera Developments, one of the pioneers of the real estate business in Pune and Goa prides itself on providing long term enjoyment to customers and innovation being a hallmark of the company’s projects. “There are many ‘firsts’ that stand to Gera Developments’ credit such as 5-Year Warranty on Real Estate, consisting of Preventive Maintenance and Repairs- First time in India, India’s first Child Centric TM project, Insurance of buildings for 3 years (prepaid), and a lot more to offer in project in the city. The real-estate industry also looks promising,” said Rohit Gera, MD, Gera Developments Pvt Ltd in his candid interaction with Remona Divekar. Excerpts:

practice it will be close to impossible to implement.

G i ven the vas t number o f developers it aims to control itself will be the biggest hurdle in implementing the law. Secondly, the law has no regulatory framework to control the financial deposits and ESCROW transactions. The implementation of this bill would also mean an increase in prices which the builders would pass onto the end users.

While, there is a strong investment sentiment for PERE transactions in India, they display a reflection of the market sentiments, where funds are looking at only embarking on projects with strong fundamentals. PE Funds continues to show keen interest in the market traditionally

September 02-08, 2013 33REAL ESTATE

as the most preferred investment which is currently pegged around $2bn? How does it impact the fund raising environment of domestic and offshore real estate players and their project? How do you compare this with other funding options available?

PERE funds were only looking at vanilla investments. The international investors are looking at a 25% return when investing in India. This is because they would like to cover the risks involved. Around $2 billion is available with PE firms for deployment in the Indian real estate sector.

India has not been able to attract a lot of foreign investments in comparison to other countries such as China and Malaysia within the region. Ongoing issues such as high inflation, large budget deficit and the slow pace of regulatory reforms are weighing down on business sentiment in addition; the flip flopping by the government on tax treaties and tax laws is giving foreign investors reasons to not invest in India.

Investors are waiting for the right opportunity and currently the market is not conducive. Foreign investors are cautious because of the continued weakness in the Indian rupee which would impact their returns. Banks have been cautious in lending because of these delays and due to tightening of lending norms by the Reserve Bank of India (RBI).

With RBI restricting use of bank debt for land acquisition, equity and mezzanine capital have become the favored option for such use. As the traditional source of finance dried up, developers approach non-banking financial companies (NBFCs) for short-term debt and private equity (PE) funds.

I anticipate that in the next few quarters, after some regulatory and politico-economic environment are regularized, the momentum in real estate will pick up throwing open more investible options.

The real estate market in many countries offers very lucrative investment prospects which tend to be cheaper, attractive to such Indian buyers. Countries such as Dubai, Singapore, Malaysia, New York, and various cities in the UK – predominantly London –They are the preferred destinations for Indian property buyers. What is your take? Is India losing out on the competition?

The government has already reduced the l imit for overseas investments for properties by Indian citizens. Notwithstanding this, the investor who looks at these markets is a seasoned-savvy investor. He is someone who already has several investments in India and is also a regular traveler to these markets.

An average investor in India is not someone who will invest a few crore rupees in these markets and spend time and money to oversee these investments. There are recent reports where Indians are the top investors in Dubai.

However, I feel the Indian market has its fair share of investors who want a very solid core investment which is more inclined towards capital gain rather than yield related. There are certain individuals who are planning for their kids’ education and housing abroad buy international real estate at attractive valuations. Currently, the variety of options available on the international property market offer very

attractive rental yield and valuations.

How much can an Indian, invest abroad in the financial year, where there are large number of aspiring Indian investors and buyers?

An Indian could invest $200,000 per person per financial year in international real estate but the limit has been brought down to $75,000 recently.

Currently what is the business focus of the company looking at the future projections of real-estate market?

What are the ongoing developments happening, where? At present which stage of completion is it?

Gera Developments is in a growth trajectory. Currently we are focused on building our business across geographies in Pune & Goa. We are also entering the Bengaluru market with a big residential project having a novel concept.

We will be expanding in Pune, which would essentially mean moving across jurisdictions. We are looking at launching residential as well as commercial projects in Pune and Goa this year.

Overall 4–5 new projects will be commenced in this calendar year. We are launching a project in the super luxury segment with Isle Royale, an exquisite villa project in Bavdhan, Pune.

We have created several landmark projects and will continue to do so. We are also known for the cutting edge innovations and first of its kind

customer centric initiatives in India that stand to the company’s credit such as 5-Year Warranty, Child CentricTM project, Insurance of buildings, Pune’s first intelligent building and first shopping mall.

Our business philosophy resonates in providing long term enjoyment to our customers, bringing transparency and building trusts in the real estate sector. We have been a trendsetter providing superior customer experience through product offerings and premium amenities like Apple i-pad handheld controls, bal lasts, 5 appl iance controls and Wi-Fi connectivity. Our primary focus at Gera Development is to capture the high end market and create top of the line residential construction.

How do you manage the project costs, right through the clearances stages?

We manage costs in a systematic manner. We set aside a pre-budget

that accounts for the clearance stage and the costs involved. If we are lucky the budget covers our costs and the time involved to get the clearances. It is also during this time that you hope that the selling prices will also increase and add to your profits.

As a leading property developer, do you look at tapping the Indian markets overseas? Would you be looking at the overseas destinations such as SAARC, ASEAN countries for developing properties? Your outlook and plans? How can one take care of land laws for investment and liability risks involved?

Yes, we do look at Indian markets overseas as NRIs are a big part of our target audiences. Given the increasing number of foreign investors in India, this segment cannot be ignored. No, as of now we are not looking at any overseas destinations for projects at the moment.

34September 02-08, 2013

of more than 8.2 billion sq. ft. of real estate space in 2025, up from about 3.6 billion sq. ft. in 2013.

Additionally, the sector is expected to contribute significantly towards bridging the employment gap in the economy by generating employment opportunities for almost 17 million people in 2025.

The drop to the volatility in the market, slower growth of the Indian economy, political stalemates and depreciation of the rupee are few concerns grappling the Indian economy, what impact is it likely to have on the future run of realty projects?

Factors such as pers is tent weakening of the rupee, political instability, sluggish economic growth and the current volatility in the market are major challenges facing the real estate sector today.

However, we foresee tremendous potential for the real estate sector consider ing the rapid pace of development taking place in the country. In the last few years, we have also seen the government taking an active role in facilitating investments into the sector, especially in low income housing, besides strengthening its resolve at propelling growth in urban as well as rural infrastructure.

Yes, the sector faces tough times in the near future on account of the sluggishness in the economy and volatility in the market. However, long term prospects appear highly positive for the sector.

REAL ESTATE

Super luxury is the USP of The Park residential project at Worli in central Mumbai. The Lodha Group purchased this plot from DLF for Rs 2,727 crore last year, and now, using a lush park as its Centre point, where the group plans to develop a variety of different projects around it, ranging from high-rises, townhouses, bungalows as well as luxury retail.

“Around the world, the finest living spaces are set alongside great parks that become an intrinsic part of the lifestyle of the residents. The Park is a rich landscape designed to provide a multitude of experiences and a diverse range of environments, offering a global luxury living experience for well-travelled and discerning homebuyers,” said the company’s Managing Director Abhishek Lodha.

The 17-acre property has been designed as a tribute to nature with seven acres set atop a 70 ft hill inspired by the great urban parks around the world, where the park offers an ideal urban lifestyle, one that is at present not possible in Mumbai.

“This seven acre space is actually equivalent to six football fields put together, or about one and a half

‘Real estate sector thriving on opportunities’

CBRE South Asia Pvt Ltd Chairman & MD Anshuman Magazine, in this interview with Remona Divekar says that opening up of the economy for investment has been instrumental in spurring broad-based fundamental growth across various sectors, including real estate. There is a growing potential for the development and growth in the real estate sector where it is expected to generate 17 million employment opportunities across the country.

times the size of the world’s largest cricket ground – the MCG (Melbourne Cricket Ground),” Lodha claimed.

Different world class designers, a r c h i t e c t s a n d b r a n d s w i l l come together fo r the mixed use development much like the development around New York’s Central Park, he added. The project will be a fully-integrated community with a choice of playgrounds, a tree house for children, a clubhouse, concierge services, and a gourmet dining options, retail plaza and India’s first Evander Holyfield gym.

Around 85 per cent o f the development will consist of open spaces, including organic gardens, picnic gardens, a ‘wetlands’ garden and a butterfly island. “During the construction phase, we expect to generate more than 5,000 jobs,” said Lodha, adding that a development of this scale will also support more than 10,000 indirect jobs in allied industries like cement, steel, tiles and cables, among others.

Once The Park is completed, it will give rise to over 500 full-time jobs in the areas of facility management, housekeeping, horticulture and retail, he said.

The Ind ian rea l es ta te and construction industry is an integral part of the economy and plays an important role in the development of the country’s infrastructure base and is one of the largest generators of economic activity. The contribution of the real estate sector to India’s GDP has been estimated at 6.3 per cent in 2013, and the segment is expected to generate 7.6 million jobs in the same period.

India’s real estate sector is estimated to have a total supply pipeline of close to 3.6 billion sq. ft. lined up for completion in the year 2013, with about 98 per cent concentrated in the residential segment where the potential for development and growth in the real-estate sector is expected to be quite high.

The total economic footprint generated by construction of real estate is approx. about Rs 2, 54,000 crore adding that it will help generate revenues worth Rs 3,70,000 core and provide jobs to about 7.6 million people across the country. Excerpts of the interaction

What are the investment opportunities available in India amid growing interest in the region’s property market? How do you manage the project costs managed right through the clearances stages?

India has wi tnessed st rong economic growth over the last decade. Opening up of the economy for investment has been instrumental in spurring broad-based fundamental growth across various sectors, including real estate.

The real estate sector has a total supply pipeline of close to 3.6 billion sq. ft. lined up for completion in 2013. About 98 per cent of this is concentrated in the residential segment, including organized as well as unorganised space.

The rest includes organised commercial office and retail space in leading cities such as the National Capital Region, Mumbai, Bengaluru, Chennai, etc. The total economic footprint generated by the construction of this real estate pipeline can be gauged from the fact that it will require a total investment of about Rs 2, 54,000 crores, will help generate revenues worth Rs 3, 70,000 crores, and provide employment to about 7.6 million people across the country. The total contribution of the real estate sector in the gross domestic product of the country has been estimated to be about 6.3% in 2013.

H o w i s I n d i a s e t f o r n e w breakthroughs when Indian metros are becoming enormously expensive where the interest rates of bank loans are already proving to be a stumbling block and may rise further with another revision of RBI norms? How much can an Indian invest abroad in the financial year where there are a large number of aspiring Indian investors and buyers?

The residential real estate prices across major metropolis cities have been on the rise and despite the slowdown, majority of the developers are holding onto prices. In order to spur sales, developers are providing incentives and freebies but are reluctant to offer substantial capital value cuts.

Interest rates on the other hand, in wake of the rising inflationary pressure and depreciating rupee have remained constant and the benefit of any previous rate cuts in 2013 have hardly been passed onto the end users. The only silver lining to the deprecating rupee has been that residential properties are garnering increased interest from NRIs.

Also, where the domestic markets are concerned with the various tightening policies in place and market sent iment remaining cautious, will there will be a drop in activity in both the new home buying segment and resale markets. What is your take?

The residential segment, including new home buying and resale, is expected to see a drop in real estate

transactions over the next few months. With the rupee depreciating, the government is introducing measures to arrest the slide.

This calls for caution on the part of buyers as well as investors as interest rates are likely to increase in the near term. So, yes, the residential market will take a hit. However, we believe this will be a short term phenomenon as once the rupee gains momentum; the government will again concentrate its efforts to boost economic growth. This will in turn lead to growth in the real estate activities, including the residential segment.

As per recent reports the real estate sector to India’s GDP has been estimated at 6.3 per cent in 2013, and the segment is expected to generate 7.6 million jobs in the same period. With this would it fast track property developments and buying patterns of the end-consumers amidst fluctuating economy?

There is no doubt that India’s real estate sector is poised for significant growth, thriving upon opportunities such as growth in income levels, increasing urbanisation and demand for new housing. With a share of 6.3 per cent in the country’s Gross Domestic Product, the sector makes a sizeable impact on India’s economic growth, both in terms of employment generat ion as wel l investment creation.

However, this footprint is restricted by numerous challenges inhibiting the sector such as high borrowing costs, lack of institutional funding, lengthy

approval processes and slow & uneven infrastructure development.

Once these bott lenecks are addressed, we can expect the economic contribution of the sector to increase considerably, with its share of the GDP to more than double from 6.3 per cent in 2013 to almost 13 per cent by 2025.

This will be a direct consequence of the voluminous construction churn generated by the projected completion

Super luxury apartments by

Lodha in Mumbai

September 02-08, 2013 35EQUIpMENT

36September 02-08, 2013CONSTRUCTION

The market for scaffolding and formwork application is set to grow in India. What is the market size for these products and services in India and your company projected market share in the next three to four years?

India is a developing nation with a large population, growing economy and aspirations. For the next 30-40 years, all kinds of infrastructure development activities are set to increase only.

Scaffolding and formwork are a small but critical part (between 1 per cent and 5 per cent of the project cost) of any construction activity.

There is no definitive data on the market size of these products which are being serviced by both organized and unorganized sources while unorganized sources may be catering to larger volumes.

In specialized aluminium formwork, currently we are in a commanding position which we plan to consolidate while in overall business, we would like to be seen as one of the leading, homegrown organization.

W h a t a r e t h e c h a l l e n g e s confronting the scaffolding and formwork industry in India? Any solutions for the same?

Very high rates of Sales Tax, Excise Duty, mushrooming f ly-by-night operators ignoring basic quality norms, lack of trained & certified scaffolders are some of the challenges being faced by the industry.

Our government should provide sufficient relief/reductions in various taxations to make such equipment at t ract ive even to the smal ler contractors/builders.

In add i t ion , c rea t ing la rge vocational training base through organizations such as the National Skill Development Corporation Ltd, etc , will go a long way to popularise modern scaffolding and formwork equipment while ensuring a safer work place.

What are the changing trends in the industry?

As the complexity and need for speedier construct ion work increase in India, we are witnessing c o n t i n u o u s a r r i v a l s o f l a r g e international companies and some of the indigenous organisations, like ours, upgrading installed facilities and innovating, technically-compatible, cost-effective solutions.

Besides option of renting in specific product range, some of the large customers are looking at complete solution such as design, supply, erection and dismantling of systems.

Several innovations have occurred in the development of new materials & techniques in scaf fo lding & formwork systems. Being one of the leaders in this segment, how do you view such developments and how these developments are a part of your ongoing product development exercise?

Using appropriate materials such as malleable castings/SG iron/forgings for critical components of steel scaffolding, alternative materials such as aluminium, plastic for formwork, have been gaining ground for suitable applications.

Continuous upgradation in our construction materials and techniques

Ashok Mandal, Director, Maini Group of Companies says that continuous upgradation in our construction materials and techniques will require going further, in an interview with Paresh Parmar.Armed with a B Tech in Civil from IIT Bombay and a Diploma in Marketing Management - Jamnalal Bajaj Institute of Management Studies, Mandal has over 30 years of vast experience in leading positions in scaffolding and formwork industry with various companies like Acrow India Ltd and BSL Scaffolding Ltd. He also has experience in the power & transmission sector where he was involved in the designing of high voltage transmission line towers for M/s Tata Exports Ltd. He is also an active member of the Institution of Engineers, the Indian Road Congress, and the Indian Concrete Institute.

‘Scaffolding, critical part of construction activity’

during erection and dismantling of scaffolding and formwork.

Any new products your company has launched.

As part of our diversif ication process in the infrastructure sector, we have launched top-of-the-line Multilevel Car Parking System (MCPS) which has already started gaining a lot acceptance in the Indian market.

And as a boost to the faith in our abilities by our esteemed customers, we have already received a few prestigious orders for these MCPSs.

will continue to be required. Our dedicated division and large

manufacturing facility of advanced aluminium formwork with latest techniques are part of our growth module. As against conventional system, a well-designed Aluminium Formwork can reduce the slab concret ing cycle t ime of large residential/commercial projects by nearly half.

What are the technical services & professional expertise required to facilitate effective implementation of formwork systems?

To f a c i l i t a t e e f f e c t i v e implementation of scaffolding and formwork systems, the following may be necessary but not limiting: good knowledge of the system being used; a dedicated and answerable technical person in-charge of all scaffolding & formwork; and availablity of trained scaffolders/ formwork men.

Tell us about your speciality in conventional and modern system of scaffolding and formwork.

We at Main i Group prov ide complete solutions to all requirements of ei ther steel scaffolding and formwork or aluminium formwork. We have extensive manufacturing base, supported by design and after-sales-services teams.

Our spec ia l i sed a lumin ium formwork system for large residential and commercial projects have found wide acceptance by many major reputed organisations, thus propelling us to a leadership position.

Safety and sustainability are of utmost importance in scaffolding and formwork; how do you look at these issues?

A good knowledge of end usage which can help adopt the correct design and determine the inputs of ideal critical components can provide safety and sustainability in scaffolding and formwork.

While treating safety as paramount, through our long years of experience in this field as an ISO 9001:2008 certified company and dedicated R&D wing, we ensure safe and long lasting products.

We also provide at nominal charges training on scaffolding use/safety and technical supervision services

Al Futtaim eyeing growth in Qatar’s facilities management market

Al Futtaim Engineering, the Dubai-based one of the biggest engineering firms, is expecting to make major in-roads into the Qatar’s facilities management (FM) market over the next few years.

“There are a lot of technical skills in the UAE that are not available in Qatar, which we have. There are very few good FM companies in Qatar who provide the quality services required,” said a top company official.

The company already has a 700-strong workforce in Qatar built up over 10 years but says it is bidding for work there on an unprecedented scale.

“Qatar is severely lacking some of the key skills needed to satisfy the huge growth going on in the country, including the servicing of MEP plant. There are a lot of technical skills in the UAE that are not available in Qatar, which we have. For example, we are very good in electro-mechanical works: rewinding, motors generators, rectifying pumps and all those things,” the official added.

The company has an eye to opportunities from World Cup 2022 as well and among AFE’s full range of air HVAC options, it can offer stadium air-conditioning – and it has already installed it.

The company has installed 39,000 diffusers to air condition the football field at the 13,000-seat Al Sadd open-air football stadium in Doha, proving it can be done and that it can work.

Scaffolding is another area where AFE expects to score highly as the complex architectural designs are turned into reality for the World Cup. Al Futtaim has a reputation for setting up scaffolding in difficult to reach places.

Nod for power projects worth Rs 174,000 cr

likely soonIn an attempt to accelerate big-ticket investment in the infrastructure sector, a ministerial panel on Monday is

expected to clear bottlenecks in installation of 28 power projects involving investment of around Rs 174,000 crore. These power projects are waiting for clearances, including assured fuel supply.

The projects include 18 power plants worth around Rs 82,000 crore which are stuck owing to lack of Fuel Supply Agreements (FSAs). An official source said the Cabinet Committee on Investment (CCI) is expected to direct the coal ministry to commit that FSAs for these power plants would be signed by. According to the source, the coal ministry has expressed willingness to sign the FSAs within the timeframe.

The ministerial panel will also take up another 10 power projects, in which investments worth Rs 92,000 crore has been stuck for various reasons including pending coal linkages and environment clearances. An official said CCI is also expected to direct ministries for expeditious clearance of these projects within a set timeframe.

The government had asked state-owned Coal India Limited (CIL) to sign FSAs with power producers for 78,000 mw capacity which are to be commissioned by March 2015 through a presidential directive issued last month.

“Once cleared by CCI, it will be a big effort in breaking the logjam in the power sector. It will provide a major boost to the energy-starved economy,” an official said. While the impact of these decisions on the ground will be visible only after a few years, fast-tracking clearances are aimed at reviving investor sentiment in India and fighting the perception of “policy paralysis”.

The government had targeted to add power capacity of 78,700 mw during the 11th Five-Year Plan (2007-12), but managed to add just 54,964 mw, almost 70 per cent of the target. The target for the 12th Plan (2012-13 to 2016-17) is to add around 80,000 mw of power capacity.

September 02-08, 2013 37COVER STORY

According to the Construction I ndus t r y Deve lopmen t Boa rd Malaysia’s (CIDB) chief execu-tive Datuk Seri Dr Judin Abdul Karim, the construction industry is expected to secure some RM110 billion worth of projects this year. The growth of the projects would be driven by the Economic Transformation Programme (ETP), adding that the construction industry would be quite robust following many projects which are expected to come on stream this year. Last year (2012), the total projects secured stood at RM120 billion, which surpassed the expected RM95 billion.

In a report he noted, “Despite the weakening world economy last year, our construction industry did very well, registering growth of about 18 per cent higher compared with 2011.”

H o w e v e r c o n s t r u c t i o n ’ s contribution to GDP is expected to fall to 13.5 per cent in 2013 from 15 per cent in 2012, with tourism and the services industry earmarked for a bigger role.

The minister said that the slight drop in construction activity could be attributed to the completion of key, large-scale projects, which the government drove through to help the economy recover from a flat patch caused by the global financial crisis.

A market report by Business Monitor International noted, “We are seeing signs that the current construction cycle has reached its peak, with construction growth in Q113 the lowest in five quarters. This outlook is primarily due to falling demand for residential and non-residential buildings, as well as financing risks in the infrastructure sector. Having

said that, the electoral victory by the ruling party has enabled the uncertainties surrounding Malaysia’s economic investment plans to begin to dissipate. This improvement in the investment climate has prompted us to revise up our outlook for Malaysia’s construction sector over the short-term, with our forecasts for construction real growth revised up to 10.1 per cent in 2013 (previously 9.1 per cent) and 6.7 per cent in 2014 (previously 6.5 per cent).”

G o i n g f u r t h e r s o m e k e y developments in the sector include the development of Project 3B. In Apri l 2013, f ive consort iums were shortlisted by the Electricity Comission for the tender exercise for a 2,000MW coal-fired power plant, known as Project 3B.

T h e p o w e r p l a n t s h o u l d be developed at the firms’ own sites. The EC revealed that it had completed the evaluation of seven RFQ submissions, short l is t ing five. The shortlisted consortiums are Malaysia Development and Mitsui; Formis Resources, SIPP Energy, Posco Energy and Posco Engineering & Construction; Tenaga Nasional, Global Power Ventures and China National Machinery Import & Export Corporation; Malakoff and Sumitomo; and YTL Power International and Ranhill Power. The closing date for the bid was set as September 30 2013. For Project 3A - a 1000 mw brownfield coal-fired power plant project - Tenaga Nasional and 1Malaysia Development were shortlisted in February 2013. The results of the tenders for Project 3A and 3B are expected to be released in the second half of 2013.

Philippines – defying slowdown

The Philippine economy expanded above 7 per cent for a fourth straight quarter, remaining one of Asia’s best performers as President Benigno

Aquino is likely to boost spending. Acco rd ing to t he Na t iona l

Stat is t ical Coordinat ion Board (NSCB), the country’s GDP rose 7.5 per cent in three months through June from a year earlier, compared with a 7.7 per cent gain in the previous quarter.

Fitch Ratings and Standard & Poor’s awarded the nation its first investment-grade rankings this year, as Aquino increased state spending and cracked down on corruption. The country may be among the world’s five fastest-growing economies this year and next, according to some analysts. It will probably expand 6.9 per cent in 2013 and 6 per cent in 2014.

The Philippine economy grew 1.4 per cent in the second quarter f rom the previous three-month period when it expanded a revised 2.3 per cent, NSCB data showed. Government spending increased 17 per cent from a year earlier, while construction jumped 17.4 per cent and manufacturing gained 10.3 per cent.

A c c o r d i n g t o Fa s t M a r k e t Research, conditions are suitable for construction industry including conducive monetary environment and robust government spending. The government’s private-public par tnersh ip (PPP) programme continues, albeit slowly, to move up the gears, providing a solid base for infrastructure activity.

Consequently, we remain bullish towards the Philippine construction sector, with real growth forecast to reach 8.1 per cent in 2013 and 7.3 per cent in 2014, the research firm said.

Mena – a plethora of opportunities

T h e c u m u l a t i v e g r o w t h i n construction industry in Middle East and North Africa (Mena) region is set to reach 80 per cent over the next

decade surpassing global Industry growth at 67 per cent as per industry sources.

Buoyed by va r ious g rowth drivers such as a young and vibrant population with significant purchasing p o w e r a n d a c o r r e s p o n d i n g shor tage in the avai lab i l i ty of affordable housing in addition to the government regulations easing the process of residential mortgages will ensure progressive developments in Saudi Arabia within the Middle East region.

Additionally regulations mandating compulsory registrations of all real estate leases will provide greater transparency and stability thereby improving real estate transactions in UAE particularly in Abu Dhabi and Dubai where construction activities of the country is mainly focused upon.

However, the fastest growth in this market wil l be recorded in Qatar which has planned to commit a significant $100 billion in rail, roads, water and other infrastructure, including preparation for hosting the 2022 Fifa World Cup. Furthermore the country is also planning to add another 800,000 hotel rooms to its existing hotel stock to felicitate the world cup event.

An estimated 800 towers (of more than 20 storeys) of residential apartments, commercial premises, hotel accommodation and mixed-use structures are planned for completion in Doha over the next ten years to provide the necessary high-density accommodation and commercial real estate. Qatar’s vision for a nationwide economic development is backed by a rapidly growing economy and prudent fiscal reserves in addition to a healthy stream of private sector participation.

S ta t i s t i cs f r om Abu Dhab i statistics centre (SCAD) showed the costs involved in 2010 construction activities witnessed a sharp decline

of 30 per cent in concrete costs with costs of roofing materials falling by 15.2 per cent, cement decline by 12.9 per cent and construction labour witnessing a fall by 10.9 per cent compared to previous years thus encouraging builders to invest more in the construction activities with the industry in the Middle East and North Africa (Mena) region is forecast to reach $4.3 trillion over the next decade. By 2020, emerging markets such as the Middle East, Africa and Asia will account for 55 per cent of global construction a marked increase from 46 per cent currently. Construction will make up 16.5 per cent of the GDP in emerging markets by 2020, up from 14.7 per cent in 2010.

While according to a leading research from Zawya, the real estate industry in the countries of the Gulf Cooperation Council (GCC) is expected to create significant business opportunities, with an anticipated $1.1 trill ion worth of projects currently in the design, bid or construction stage.

With an overal l construct ion spend expected to reach $2.54 trillion across all major sectors, the UAE and Saudi Arabia remain at the top of the list in terms of spend, and projects are currently estimated at $903.05 billion and $766.77 billion respectively.

Infrastructure, oil & gas and power & water are three sectors creating strong opportunities for the building and construction industry within the GCC; however, it is real estate that is set to dominate the market in years to come. There is an anticipated $528.41 billion of projects in the UAE and $321.42 billion in Saudi Arabia, two geographies continuing to lead within the GCC, according to the research from Zawya.

(Contd. from pg. 3)

Menasa

38September 02-08, 2013EQUIpMENT

With rupee being at an all-time low, with interest rates going up, with inflation soaring high, with GDP growth going down and with drastic drop in investments, the economic scenario of India seems rather gloomy.

Many companies in the Construction and Construction Equipment industry see no light at the end of the tunnel. However, contrary to the popular belief of today, I think that there is certainly light at the end…where does the tunnel end is anybody’s guess, I feel it may not be as far ahead as most believe.

We mustn’t forget that amid all this sluggishness in the Indian economy and global economic slowdown, India still remains the second fastest growing economy. In addition to the second largest English-speaking nation with a strong base of middle class consumers, our biggest strength is that we are a young nation in a developing economy and we need to use this opportunity. A young country means having more innovative minds, if skilled properly.

Forward-looking approach to infra development needed

Further, many believe the growth we have seen in the Infrastructure sector in the last few years was once in a lifetime growth but being an optimist, I firmly believe that we will witness another similar upsurge in the coming time.

Though the current scenario in the Indian infrastructure sector is challenging, with no immediate growth, but our government now seems focused on ensuring that infrastructure in the country starts moving again. Issues like project execution; monitoring and ministerial disputes have now become a key concern for the industry but we are seeing lot of reforms and initiatives being introduced by the Government to battle these issues.

Setting up a Cabinet Committee on Investment (CCI) for example is a positive step towards accelerating growth. The board is determined to clear infrastructure projects which are stuck due to issues like land acquisition or environment.

For example, the CCI has recently

approved of setting up two hydro power projects in Arunachal Pradesh. Very recently, we hear the CCI has cleared 171 projects worth Rs 1.69 lakh crore. Once infrastructure moves, so will the infrastructure building machinery.

Apart from the infrastructure projects not taking off at the desired speed, there are few other issues that are also posing a problem for the Indian construction equipment industry likeimport of low quality used equipment, lack of skilled manpower, unavailability of adequate exclusive testing facilities, etc.

The ICEMA (Indian Construction E q u i p m e n t M a n u f a c t u r e r s Association) with the support of its entire member body continues to work closely work with the government executives to formulate policies and regulatory framework that will help us in addressing these issues.

The ICEMA has submi t ted its proposal to the National Skill Development Corporation for setting up the Sector Skill Council for the

Construction Equipment Industry. The National Skill Development Council (NSDC) facilitates the development and upgrading of the skills of the growing Indian workforce through skill training programs.

According to the CII-Accenture Vision 2020 report, by 2020, the industry would require over 2 million skilled personnel for the maintenance and operation of equipment which is over and above the workforce employed at present.

The ICEMA is also closely working with the government to address the issue of low quality used equipment import. We suggest that multiple port entry should be restricted. We should have a single or dual port entry system as it will allow us to better examine the machines on various parameters like safety, emission, etc.

The Association has been closely interacting with the Department of Heavy Industry and other organization for setting up an independent test centre for construction equipment industry. This test facility will also serve as a training ground for service

engineers thus, improving the overall customer support.

With government doubling its investment to $1 trillion in the current five year plan we need to ensure prompt actions are taken. I’m certain that the recent initiatives and reforms introduced by the government will increase the confidence level among the investors. We have the resources, we have the capital, all we need is a more forward looking approach towards infrastructure development.

Amit Gossain EVP - Market ing, Bus iness

Development and Corporate Affairs, JCB India Ltd and President , ICEMA

Shantui to launch new models at bauma Africa 2013

German pavilion at bauma Africa 2013

The bauma Africa Trade Fair will provide 60 000m2 of exhibition space at the Gallagher Convention Centre, bringing together more than 500 exhibitors and 15,000 visitors from the construction and mining sectors. Shantui Equipment Southern Africa director and vice general manager for Shandong Shantui Construction Machinery Import and Export Co., Ltd Dylan Chicken believes that this event serves as the ideal platform for the company’s new product launches.

“Shantui’s substantial 800 m2 exhibition area will see the launch of a number of the company’s latest product and network developments. What’s more, Shantui will also be demonstrating a range of its more established and trusted machinery, in order to emphasize the company’s long term commitment to the rapidly developing African economy,” he explains.

Chicken stresses that Africa will play an instrumental role in the future growth and development of the Shantui brand, which currently has a total machine population in excess of 5,500 units throughout the continent, of which more than 550 units are in Southern Africa. “Africa is a strategic market for Shantui, and this is clearly evident in the fact that three of the company’s ten global subsidiaries are located in Africa, which holds unlimited potential for growth opportunities.”

Shantui Equipment Southern Africa vice general manager, Garron Troskie, points out that the company’s new SE480 excavator boasts a 47.6 ton operating weight and a bucket capacity of 2.3m3, making it ideally suited for mining and quarrying applications.

“Mining and quarrying are among the most rapidly developing sectors in Africa, and the introduction of the SE480 excavator will assist Shantui in gaining a stronger foothold in this market. The excavator offers power and quality at an affordable price, and

is designed for quarrying applications, as well as for entry level mining operations.”

Chicken highlights the fact that the latest -3 version of the Shantui SL60W wheel loader is also designed for mining and quarry applications. “The Shantui SL60W-3 wheel loader is powered by a Cummins engine, which develops 175 kW.This unit has an operating weight of 21 tons and has a 3.5m³ bucket capacity,” he continues.

In addition to the new product launches, Shantui wi l l a lso be displaying its range of tried and trusted machinery at bauma Africa, including;

Shan tu i SD32W bu l ldoze r : Powered by a Cummins NTA855-C360 engine,which develops 235 kW/ 320 hp, it has an operating weight of 41.5 tons and is equipped with a single-shank ripper with a ripping depth of 1 m. The unit is further equipped with a R.O.P.S. /F.O.P.S. cab, rock application tracks and blade.

Shantui SD22W bulldozer: This model is powered by a Cummins NTA855-C280 engine, which develops 162 kW/220 hp. This unit has an operating weight of 25.5 tons and includes a three-shank ripper with a R.O.P.S. /F.O.P.S.cab.

Shantui SG21-3 motor grader: Driven by an In-line six cylinder, 4 stroke, overhead valve direct injection Cummins 6CTAA8.3-C215 engine, which is turbo charged and intercooled and develops 160 kW. It has an operating weight of 17 tons, while the working performance of the blade at an inclined angle is 90 degrees, and the turning angle of the blade is 360 degrees. This unit comes complete with a 3965 mm/4270 mm blade, and includes air conditioning.

Shantui SR12 roller: The Shantui SR12-5 smooth drum roller ispowered by a Deutz engine, which develops 82 kW/116 hp, has a fully enclosed cab, front drum and rear wheel drive,

variable frequency and amplitude control and a climbing gradeability of 40 per cent. Also included are pad-foot shells for attachment to the smooth drum.

Shantui SF50 forklift: Is powered by a Weichai engine, which develops 81 kW. This unit has an operating weight of 8.1 tons. The lifting height of this machine is 4.42 m, with the bottom mast clearance of 195 mm, in addition to a 5 ton lifting capacity.

China-based Shantui has managed to distance itself from the negative typecast of inferior quality and service commonly associated with the Chinese manufacturing sector, to become the largest bulldozer manufacturer in the world.

Chicken attributes this continued success and rapidly increasing geographical footprint across Africa to the company’s core values and solid business strategy. “We insist on specified components that our African customers have come to know and trust, as opposed to merely accepting generic components from any factory in China. We also place a high emphasis on customer relationships, and always encourage customer feedback to constantly improve our overall product and service offering.”

Another major contributor to this success is the fact that most Shantui machinery is powered by engines manufactured by Cummins - a global leader in the manufacture, sales and servicing of diesel engines and related technology.

The Sub-Sahara region is on the move, a fact proved by positive economic forecasts and extensive i n v e s t m e n t s i n t h e r e g i o n ’ s infrastructure. The cumulative gross-domestic product in the Sub-Sahara region is expected to increase by some 6% in 2012. Countries south of the Sahara are rich in natural resources such as diamonds, gold and chrome. That attracts additional investments in the mining sector.

More than 70 German companies will display their products in the German Pavilion at bauma Africa 2013. bauma Africa has been included in the German Foreign Trade Fair Programme of the Federal Ministry of Economics and Technology (BMWi) at the request of the German Engineering Federation (VDMA) and is carried through by IMAG - International Trade Fair Service.

The VDMA represents via its Construction Equipment and Building Material Machinery Association 300 mainly medium-sized companies of

the construction equipment sector. VDMA provides business contacts, market and industry information and is the point of contact for enquiries on the German construction equipment and building material machinery sector.

With about 43,000 employees in Germany and a turnover of about 12.5 billion Euros in 2012, this sector is one of the leading sectors within the machinery industry. German companies offer their products worldwide and have sales offices, production sites and representative offices all around the globe.

Together wi th the USA and Japan, Germany is one of the three leading exporters of construction equipment and building material machinery worldwide. A lot of German manufacturers are market and/or technology leader in their field of expertise, e.g. when it comes to concrete, tunnelling and road construction technologies.

September 02-08, 2013 39CEMENT

Aditya Birla close to fix deal with JP’s Gujarat cement plant

The Aditya Birla Group is close to concluding a deal to buy out Jaiprakash Associates' cement plant in Gujarat. The Kumar Mangalam Birla-controlled conglomerate is likely to pay close to Rs 3,500 crore to acquire the 4.8 million tpa unit and an announcement to this effect is likely in early September.

"We are in discussions for over a year, and now nearing a deal. There

could be a formal announcement soon if things do not go haywire at the last minute," said an executive close to the transaction. The deal will help the group's cement company UltraTech Cement to ramp up capacity.

"By 2015 our goal is to scale up our cement capacity to 64.45 million tons per annum from the current 53.90 million tons," said group Chairman Kumar Mangalam Birla.

Talks between the two fell through

towards the end of last year due to differences over valuation. However, negotiations revived recently after valuations fell in the wake of the slump in the economy and the capital markets.

The $40-billion conglomerate had earlier offered close to Rs 4,500 crore for the plant since it provides access to the fast-growing Gujarat market. If the deal is struck at Rs 3,500 crore, it would imply a valuation of $110 per

ton. This is nearly half of the $230 per ton Barings Private Equity Asia had paid for buying 14 per cent stake in Lafarge India for an absolute amount of Rs 1,400 crore.

The deal will help Jaiprakash Associates to cut costs and arrest a decline in profit.

Holcim to swap assets with Cemex in Europe

Holcim, the world’s largest cement maker by market value, said that it would swap some assets with Mexican peer Cemex in Europe, with the aim of boosting operating profit by at least 20 million euro ($26.8 million). As part of reorganization,

Holcim wil l acquire Cemex’s operations in Western Germany, while Cemex will take over Holcim’s operations in the Czech Republic. The two companies will also combine their operations in Spain, with Holcim taking a 25 per cent stake in the combined entity. Holcim said it would pay Cemex 70 million euro in cash for the interlinked transactions.

Cemex, one of the world's biggest cement companies, has struggled amid the global economic downturn and a heavy debt load from costly acquisitions.

Centre plans sale of four Cement Corp units

The Centre has proposed sale of four non-operating units of the Cement Corporation of India (CCI) which may fetch over Rs 1,300 crore.

The CCI, which was set up in 1965, comes under the Ministry of Heavy Industries & Public Enterprises. The government has 100 per cent shareholding in the public sector unit. In total, the company has 10 units out of which 7 are non-functional.

"The Cement Corporation of India has started the sale process as it has invited expression of interest for outright sale of 4 non-operational units. The sale would be done through an e-auction process," said an official.

Siam Cement plans $388 m cement plant in Myanmar

Thailand's Siam Cement Pcl plans to build a 12.4 billion baht ($388 million) fully integrated cement plant in Myanmar as part of its drive to tap strong demand for construction materials in Southeast Asia.

The facility would be Siam Cement's first in Myanmar and will have annual capacity of 1.8 million tons, the company said in a statement. The plant is expected to start production by mid-2016.

Siam Cement, Southeast Asia's second largest cement maker, is also building production facilities in Indonesia and Cambodia to feed growing demand from a region that is home to some of the world's fastest growing economies and frontier markets.

Cement demand in Myanmar is expected to increase by 10 per cent a year for the next five years. Last year, Siam Cement accounted for more than 40 per cent of the 4 million tonnes of cement that Myanmar used.

Siam Cement is 30 per cent owned by the Thai royal family's investment arm, the Crown Property Bureau.

40September 02-08, 2013TECHNOLOgY

Benefits of ERP to construction industry

E-resource ERP for construction industry was developed keeping in mind core functional areas such as project monitoring and control, sales management, tendering, bill of quantities, purchase and supplier management, onsite engineers portal, material management, labor and contractors management, accounts management and human resource management have been given extra care and prominence.

With usage of E-resource ERP, all activities right from pre-construction stage to post construction stage can be captured and monitored. Management can access and manage onsite activit ies from anywhere anytime. Independent estimates can be generated for each task based on respective quantities estimating it is facilitated by system prompted activities. All different activities can be defined as different assemblies. Associated with each assemblies are bill of quantities, labors, turnaround time for completion.

Project estimateOne of the biggest challenges

faced by construction companies is the preparation of estimate of a construction project, which in turn helps it in containing overheads and expenses. Since the projects are usually spread over many years, aligning the projected cost with the actual cost becomes difficult. The challenge becomes manifold given that most companies deal with large project and huge volumes.

Whenever there was an enquiry, each department would have to pull out the information and consolidate it for the report. The entire process of collecting and collating information from various departments was being done manually.

This not only slowed down the decision-making process but also create power centers within the company. This made it very difficult to do real-time cost estimation of different projects.

Scheduling interface similar to MS Project Interface has been provided with grant chart view. Estimated schedule and actual activity of all tasks are made available at one screen with Grant Chart View. Resource Management takes in to account of all resources utilization, keeping track of materials, while Resource sheet lists activity with estimated quantity and rate for each item.

Advantages Comprehensive cost estimation

while maintaining a detailed and reliable cost history centrally.

Estimation through the use of central libraries, historic cost records and time and materials worksheets.

Review of the engineer’s estimate of probable cost; produce a proposal bid item list for inclusion in the bid of documents.

ERP for construction industry is a process of collecting and collating

information from various departments which

not only slowed down the decision-making

process but also creates power centres within the

company

Issue prime contracts, subcontracts, purchase orders, potential change orders, and change orders, then release these items to accounting for review, approval, and use.

Access subcontract and PO status, initial and revised totals, pending and approved changes, and amounts invoiced, retained and paid.

Access pre-designed reports and inquiries or design your own.

Readily configured Master tables and items for infrastructure projects (such as f ixed asset types for construction equipment).

Creation of projects based on receipt of tenders and creation of tender responses.

Creat ion of budgets based on detailed BoQ-based project estimation.

Enterprise managementThe construction and infrastructure

companies are witnessing the results of enterprise management and consolidation of information. One of the many benefits of implementing eresource ERP solution has been a tight integration between all projects and site offices with the company headquarters.

As a result of this improved

coordination there is greater efficiency across the various business processes and activities. The company will able to get a complete breakdown of its project costs in terms of material. When implemented, eresource ERP can make all operations smooth, t ransparent and f lexible which ultimately help the company grow their business to new heights with handsome return on investment.

In this fast paced and developing era, to sustain in the infrastructure business one need to ally with the Information Technology (IT). ERP is one such comprehensive tool which proves as a doubly edged sword i.e; it not only eases the work flow of the firm but it also helps one in strategic planning.

Multiple projectsGenerally what happens in this

industry is that, there are multiple projects running simultaneously and it is not always possible to be physically available at two different construction sites at the same time.

Infrastructure ERP dissolves all the barriers by integrating the existing projects along with their deadlines and the penalties which one need to pay if it doesn’t meet the deadlines. Thus, you

get a bird’s eye view of the scenarios in the construction site and maintain a command over the situations by prioritizing the scheduled work.

Indian infrastructure industry suffers from capacity constraints; Estimates in terms of Man, Material, BoQ (Bill of Quantity) items, time frame, contractors, and labourers are generally inconsistent.

It needs to communicate on a large scale with other related businesses such as material and equipment suppliers, vendors, subcontractors and clients. BoQ management, project management, visibility of material procurement and material consumption onsite, visibility of progress on the site are of prime importance. In order to gain visibility, it is imperative to have ERP system that would help customer with visibility of all strategic information at one centre market place so that decision can be taken faster.

Connectivity on-the-goWeb-based ERP solutions assure

connectivity on-the-go (provided one has got an accessible system/smartphone and internet connectivity, thus giving you a global reach irrespective of the geographies. With web-based solutions, you go centralized so the concept of carrying the required data whenever and wherever you go is eliminated.

Also, a list of contractors/sub-contractors, project managers, labourers, fixed assets, etc. are fed into the database and a report of these data can be obtained against the hired contractors/sub-contractors, their charges, availability and performances. This would render transparency of the organization and enhance your performance, with the deadlines of the project and availability of resources at the back of your mind.

ERP for infrastructure businesses prompts regular alerts, the current trend in purchase costing against the project costing and help you plan accordingly. It also renders daily time sheets from site to be indexed in the payroll master for generating job-wise main cost reports, site manpower cost and generation of overtime cost for processing salaries.

There are job based incentives and constant changes in job salaries; the

Infrastructure ERP can very well handle such situations and enhance the smooth functioning of the business.

Industry takeThe scenario in real estate business

is more or less the same; all you need to focus is the turnaround time for completion of the projects, the computation of legal documents, and the availability of contractors/sub-contractors, tenders etc. Financial Management is of due importance here.

The labourers get paid on a daily basis against their attendance taken on the construction site. And one has to make sure that everyone gets their proper share that too on proper time.

The ERP system main ta ins various account statements, pending capitals from the customers, petty cash availability and prompts the contractors to get the pending money from their customer and maintain the cash flow cycle.

ERP solutions provide a solid backbone for project execution by providing real-time information of the progress of projects across all its sites. Brings together different phases of construction cycles: design, development, tendering/bidding, budgets, planning and scheduling.

By bringing together stakeholders such as architects, designers, vendors, sub-contractors, clients and the company on a single platform, ERP has proven that it is one such sturdy tool which would help this industry.

Sudheer Nair CEO–E-resource Infotech Pvt. Ltd.

REAL ESTATE

Dehradun a hit among NRI property investors

Releasing the Assocham paper on “Falling Rupee sparks property boom from NRIs” D S Rawat, Secretary General Assocham said, “With the rupee riding low against the dollar, Indian residents are looking to accelerate investment plans back home”. The rupee has fallen by about 34% against the US dollar since August 2011 and crossed 65 against the dollar.

The survey highl ighted that Bangalore is the most favori te property investment destination for NRIs fo l lowed by Chennai (2nd), Mumbai (3rd), Ahmedabad (4th), and Dehradun (5th). A lot of Punjabis settled in Canada and UK are expected to invest more in Chandigarh sub-urban like Dera basi, Mohali and Panchukla.

This time, there is a lower demand for the Delhi-NCR market, adds the Assocham survey. Assocham conducted a random survey of nearly 1,250 real estate developers in Delhi-NCR, Dera Basi, Mohali near Chandigarh, Mumbai, Kolkata, Bangalore, Hyderabad, Ahmedabad, Pune, Dehradun, Chennai etc. The

survey reveals that interest for buying property by NRIs have increased due to favourable exchange rates.

The enquiries may go up further if rupee continues to slide, adds majority of the real estate developers. The majority of real estate developer said, the NRI traffic is coming primarily from the UAE/Gulf region, US, Singapore, Australia, UK, Canada, South-Africa etc.

The demand is more for high end properties and commercial buildings. As per the recent estimates, nearly 5 million Indian expatriates live in the six Gulf Co-operation Council (GCC) countries of Bahrain, Kuwait, Oman, Qatar, Saudi Arabia and the UAE, and they remit close to $30 billion to India every year and have been growing over the years.

Housing project by Tata to see light of dayWith the Punjab and Haryana High Court vacating stay on the

construction of Tata Camelot Housing Project, the company’s ambitious Rs 1,800-crore housing project in the Kansal villages of SAS Nagar near Chandigarh may see light of the day. The ambitious project was hanging in balance since November 2010, when it was challenged in the High Court.

The Tata Housing Project would be tricity’s (Chandigarh, Mohali and Panchkula) first skyscraper with 1,500-1,700 high-end flats spread across 53 acres and likely to attract an investment of Rs 1,800 crore. The project comprises of high-rise buildings, some up to 35 floors. It is worth noting that earlier the High Court had stayed construction activity in the Sukhna Lake catchment project in May

September 02-08, 2013 41COMpANY pROFILE

Kirby: Building the country’s dreams in steel

K i rby Bu i ld i ng Sys tems , a subsidiary of Kuwait based $2 billion Alghanim Industries, is one of the world’s largest PEB manufacturers. The company with total annual capacity of 400,000 mt across 5 different locations (Kuwait, UAE, Hyderabad & Haridwar in India, Vietnam) has vast experience of serving more than 60,000 customers across the globe since 1976.

Kirby Building Systems started the revolution in the construction industry with the introduction of PEB concept in India in 1999. Since then it has gained impetus in the construction industry and Kirby is leading this revolution with its constant innovation in products and applications thereby setting new benchmarks for the PEB industry.

K i rby Ind ia has a capac i ty of 200,000 mt per annum with Hyderabad and Haridwar each having an annual capacity of 100,000 mt respectively, thereby making the company a leading player in the Indian PEB market with a market share of over 30 per cent.

Kirby India has over 27 sales offices and a network of more than 100 certified builders to cater to the erection procedures as per the international standards capable to handle any type of complexity under adverse site conditions.

The company has served over 4,500 customers with more than 15,000 buildings spread over an area of 20 mil l ion sq. m since its inception. Kirby India has the privilege of partnering who’s who of corporates both from national and international front operating across all industry segments by setting up their facilities in India and across the globe.

Kirby’s Hyderabad and Haridwar factories are ISO 9001:2008 certified. Kirby is also a member of Indian Green Building Council (IGBC) and Institute for Steel Development & Growth (INSDAG).

The company has also been awarded with British Safety Council membership after meeting their stringent qualifying criteria. Kirby’s internal processes and operations are well integrated through SAP thereby ensuring the best customer service.

Kirby’s buildings are designed as per the international standards in norms with AISC, AISI, MBMA, BIS, etc. and as per the customer’s requirements. The company uses its proprietary software for design and detailing of PEB structures, in addition to the standard packages which include AutoCAD, STAADPro, ProSteel, Tekla, etc. which allows all the buildings to be customized as per the unique demands of the customers.

One of i ts popular products include KSS-600 (Kirby Standing Seam Panel) roofing system which is having double lock standing seam ends and is 100% leak proof. Kirby is the first PEB manufacturer in India to achieve FM Global approval for its KSS-600 roofing system.

Steel is the preferred material for all Prefab structures and PEBs use steel which is more than 90 per cent recyclable. These buildings are cost effective, energy efficient and provide better quality environment as they are cooler in hot conditions due to the favorable roofing material and natural ventilation.

These buildings also help in energy saving due to more amount of natural sunlight through skylights used on the roof of the building

thereby reducing the overall power consumption.

Effective usage of insulation material, louvers and other materials also help in making PEB one of the most preferred green buildings. Kirby supplied its buildings with materials which are easily recyclable and do not use materials that are harmful for the environment. Kirby is always looking forward to be a part of green buildings and eco-friendly products.

T h e c o m p a n y h a s a l s o demonstrated i ts capabi l i ty to design and manufacture complex & heavy structures by executing mega projects in the Automobile, Shipyard, General Engineering, Infrastructure, Logistics and various other industry segments.

These big projects require not only the superior design but also excellent project management right from beginning to the end. Kirby India has also successfully ventured into many unexplored territories like Power Plant Structures, Bridge Girders, Shipyard, etc. and became the role model for other PEB players by making inroads into these areas and laying the foundation for similar type of projects.

Some of the unique projects the company has executed include

Renau l t -N issan , Chenna i – World’s single largest PEB at one single location involving over 20,000 mt of steel and spread over an area of 300,000 sqm;

Pipavav Shipyard Ltd., Pipavav – one of the largest ship building facilities built with a height of 40 m; Gammon India, Delhi - Pre-engineered Steel Bridge Girder which is one of its type in India for Commonwealth Games 2010;

Madhucon Projects Ltd, Nellore - Power Plant Structure (TG Building) for their 300 mw thermal power plant with heavy structural columns weighing 17 MT each;

Toshiba-JSW, Chennai – Unique structure consisting of a single 500 mt;

Hindusthan Nat ional Glass, Nashik – World’s largest container glass manufacturing facility;

Hansen Drives, Coimbatore – World’s largest wind turbine gear box manufacturing facility;

Nipro India, Satara – 90 m long Standing Seam roofing system;

Danieli India Ltd, AP – Complex structure with 42 nos of cranes running across different directions;

Delhi Metro, Delhi, – First of its type with curved rafters and the first metro rail to use PEB technology;

Bengalore Metro, Bengaluru – Sheeting through reverse rolling;

Suzlon Wind Energy, Mangalore – Wor ld ’s la rgest ro tor b lade manufacturing facility;

S E Forge, Coimbatore – World’s largest foundry;

Sterlite Infratech, Aurangabad – G+6 structure to manufacture optical cable with heavy loading on each floor and many more such projects across India

K i r b y a l s o r e c e i v e d s o m e recognitions and accolades such as CNB C -TV18 In f ras t ruc tu re Excellence Award 2011, Greentech Environment & Safety Awards 2011, EPC World Awards 2011, Greentech Safety Award 2012 and various other awards in seminars or events where the company has participated or sponsored over these years.

Currently, the industry is growing at an average of 10-15 percent per annum with the market demand

pegged at 500,000 mt per annum. Due to the increasing demand for these type of structures, Kirby has entered into heavy engineering applications that include offices/c o m m e r c i a l b u i l d i n g s / h i g h r ise buildings, shopping malls, multiplexes, power plants, oil & gas structures, steel plants, bridge girders, mult i- level car parking structures, airport terminal buildings, residential buildings, etc. to cater to growing structural steel demand in the country.

Over these years, Kirby India has evolved from a mere manufacturer of PEB to a total solution provider that is capable of supplying a packaged solution for all building requirements maintaining international quality standards and fulfilling the entire customer demand.

Like a true leader, it has constantly tried to set new standards in the PEB industry. Its buildings have stood the test of time, time and again against all odds – manmade and natural.

JSPL secures five iron ore mining contracts in

Africa

Steel producer Jindal Steel and Power (JSPL) has been awarded five exploration contracts for iron ore exploration in African nations.

The company secured the new contracts at the time when iron ore mining is banned in the home market, India.

JSPL Managing Director and Chief Executive Ravi Uppal told the Business Standard that the country has received mining licenses in Namibia, Gabon, Sierra Leone, Mauritania and South Africa.

"We have started testing to access the exact number of reserves. It will take about 12-18 months to finalise," added Uppal.

The latest contracts are part of the company's aim to expand its focus on overseas business, primarily for the purposed of supply of raw materials as well as to reduce risk in prices.

JSPL's global business, which currently contributes 15 per cent to the company's total revenues, is expected to increase to 20-25 per cent during the coming two years.

42September 02-08, 2013EVENTS

Editor : Bina VermaEditorial Team: Dilip Phansalkar, Paresh Parmar, Remona Divekar Designer: Rajen Mistry

Business Team: Rajendra Sadhale (9321490697), Milind Joglekar (9833357005), Shantanu Baraskar (9820904795), Seema Kohli (9820904931)

Email: contact@konstructionreview.com, editor@mmronline.com

BOOK YOUR SPACE NOW !Contact:Rajendra Sadhale, Sales Head

(Construction Industry Review, Minerals & Metals Review, Foundry Review)Asian Industry & Information Services Pvt. Ltd. Handfone: 932149 0697 / 810 8288333

No part of the contents of Construction Industry Review, in abridged or unabridged form, can be reproduced without the written permission of the Editor. CIR does not accept any

responsibility for statements and opinions expressed by the authors.

The Big 5 Construct IndiaThe Big 5 Construct India will be

held for three consecutive days at Bombay Convention and Exhibition Centre or BCEC (Sept 2 – 4, 2013). This show in Mumbai is expected to attract exhibitors from overseas and from all across India.

Fo r m o r e t h a n t h r e e decades, The Big 5 has been the premier platform for suppliers of construction products looking to connect with high profile buyers from the Middle East, South East and Asian market.

From modest beginnings with just one hall, The Big 5 has gone from strength to strength, to evolve into the largest, most influential and renowned portfolio of construction industry events spanning the Middle East and India. The Big 5 network now includes more than 300,000 construction suppliers and buyers from 120 countries worldwide.

New for 2013, and organized by the Federation of Indian Chamber of Commerce (FICCI), the Ministry of Urban Development (Government of India) in association with dmg :: events, The Big 5 Construct India is

the gateway to the one of the world’s fastest growing markets.

India presents unprecedented opportunities for construction product suppliers looking to enter the market. The 10th largest economy in the

world for nominal GDP and the third largest by purchasing power parity, India’s infrastructure and construction sectors have witnessed phenomenal growth over the last five years with a projected spend of $167 billion on real estate development, $65 billion on the country’s railways, $92 billion on roads and highways, $22 billion on ports, and $8 billion on airport build and construction by 2020.

The winning combination of The Big 5 brand’s reputation, industry-wide database opportunities and FICCI’s commercia l know-how expertise will come together for four days of business and networking

as The Big 5 Construct India reaches out to the market by opening a highly organized and professional gateway through which global suppliers will be able to showcase their range of products to buyers from across the country.

A series of free seminars, panel discussions and l ive interactive demonstrations will complement the show floor activity, providing participants

with up-to-the-minute information, trends analysis and best practice case studies to improve the decision making process and encourage investment.

A one-of-a-kind forum for suppliers and buyers looking to meet and do business with the best in business, The Big 5 Construct India is set to deliver an outstanding industry event.

This event will provide the ideal platform for influential architects, con t rac to rs , consu l tan ts and engineers to share ideas about innovative construction tools and services. The show wi l l create business opportunities for attendees. Key market players and industry stalwarts will gather under the same roof and will discuss relevant issues related to construction industry. During this show latest construction tools will be showcased. This will be one of the largest exhibitions in this region will widen the market for attendees. The visitors will have the platform to interact with the industry leaders.

EVENTSSept. 2-4, 2013

The Big 5 Construct IndiaThe international building and construction showBombay Exhibition Centre, Mumbai Contact: Jasmeet Singh Tel: +91-11-23323492 (D) 23738760-70 Mobile: +91-9818724323 Fax: +91-11-23359734 (D) 23721504 arun.gupta@ficci.com www.thebig5constructionindia.com

Sept. 5, 20135th International Seminar on Technological Development in Iron & Steel: Production to Final ProcessingHotel Taj Bengal, Kolkata Contact: Steel Tech, info@steeltech-india.com amitchatterjee1944@gmail.com

October 5, 201317th Workshop on Structural AuditThe Institution of Engineers (India), Maharashtra State Centre, MumbaiThe Institution of Engineers (India), Mumbai, has organised the 17th workshop on structural audit and jirnoddhara upgrading existing RCC buildings. The workshop would also focus on fixing leakage and waterproofing of existing RCC buildings, and a new concept to construct durable RCC buildings. Contact: Mr. Jayakumar Jivraj Shah Tel: 022-28483541 Mobile: 9819242649 jjshah123123@rediffmail.com

Oct. 17-20, 2013ET ACETECH-MumbaiBombay Exhibition Centre, MumbaiLeading Indian building and construction trade events in India where the line of products put on exhibit here is extensive too, ranging right from bath and kitchen fittings, tiles and marbles, to water treatment systems, safety appliances and automation devices. Contact: Harsh Khanna, Asian Business Exhibitions & Conferences Ltd. 530 Laxmi Plaza, Laxmi Industrial Estate, New Link Road, Andheri (West), Mumbai Tel: 022-40504900 Fax: 022-26367676

Oct. 24-26, 2013 World of Concrete IndiaHITEX Exhibition Centre, Hyderabad The highlights of World of Concrete India will include innovation of latest construction and concrete production equipment. Contact: Tom Cindric, Inter Ads Exhibitions Private Limited Plot No. 859, Phase V, Udyog Vihar, Gurgaon, Haryana, India Tel: 0124-4524508 Fax: 0124-4381162 Tel: +1-972-5366371

Nov. 12-14, 2013Inter Solar India 2013Bombay Exhibition Centre, MumbaiThe largest exhibition for the Indian solar industry. More than 300 exhibitors and 8,500 industrial professionals expected to attend. Contact: Brijesh Nair, Sr. Project Manager 0091-80808 44022 0091-22-4255 4707

Nov. 20-24, 2013EXCON 2013Bangalore International Exhibition Centre, BengaluruThe 7th international construction equipment and construction technology trade fair Contact: EXCON 2013, the Confederation of Indian Industry, 98/1 Velachery Main Road, Guindy, Chennai 600 032 Phone: 044-42444555 Fax: 044-42444510 excon@cii.in www.excon.in, www.cii.in

Dec. 20-22, 2013Building Materials ExpoChennai Trade Centre, ChennaiA platform for the development of building and construction industry where this expo will help to improve the performances of the professionals, satisfy the needs and demands of their clients and customers. Contact: Manoj Kumar, Prompt Tradefairs(India) Pvt. Ltd. 621, 3rd Floor, SIRE Mansion Thousand Lights, Chennai Tel: 044-42323362/42142438 Fax: 044-42142438

February 13-16, 2014Constro 2014International Exhibition on Construction Machinery, Material Methods and Projects, Pune Contact : Sharad Bavadekar, Chairman, Constro-2014, Pune Construction Engineering Research Foundation (PCERF), 6 Shriniwas Building, Patwardhan Baug, Erandwane Co-Op Hsg. Society, Pune 411 004 Telefax: 91-20-2544 7356 / 2544 7748 infoconstro@gmail.com www.constroindia.org

March 13-15, 2014Concrete Show – 2014Concrete Material & Machinery, Mumbai Contact: UBM India, Unit No. 1&2, B-Wing 5th floor, Times Square, Andheri-Kurla Rd, Marol, Andheri (E), Mumbai - 59. Phone: +91-22-61727272 Fax: +91-22-61727273 info.india@ubm.com www.ubmindia.in

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