Finance Minister Arun Jaitley said on Monday that plans outlined in the Union Budget, along with the enactment of the recently amended arbitration law, could make the spectre of stalled infrastructure projects across the country, a thing of the past.

“Some of the important initiatives we have taken over the past year and announced in the Budget, delays in our infrastructural program itself could be eliminated. In the Budget, I have announced how disputes must be resolved for public contracts. A statutory mechanism would be created so that these projects don’t remain stalled for years,” Mr Jaitley said, while addressing investors at the Happening Haryana Summit.

Citing the example of the Kundli-Manesar expressway in the state that had been delayed for years, the finance minister said such projects can have a transformational impact on regional economies but get stuck in red tape.

“One of the important factors that stalls these projects is that with the passage of time, costs escalate beyond estimates, both because of raw material and labour costs going up and therefore, nobody in government is willing to take the responsibility for such cost escalations,” Mr Jaitley pointed out, adding that a statutory mechanism to negotiate cost escalations under an oversight would be put into operation.

Stressing that the country’s arbitration law now provides a fast-track mechanism to resolve cases within a year and commercial divisions have been created in every High Court, the finance minister said, “All these initiatives when taken together, the reason for indefinite delays in infrastructure projects which not only hurts the state and imposes much larger costs as well as inconvenience to people.”

Mr Jaitley, who reached the summit venue in Gurgaon twenty minutes late, blamed the state of National Highway 8 for the delay and called for urgent action to develop alternate routes to connect Delhi with Gurgaon and districts beyond it.

“I see no reason for (this)…I heard Pawan Munjal mentioning that it used to take him 45 minutes to reach Rourkela but it now takes 1.5 hours. And if we don’t immediately do something to address this, it would take three hours in a few years from now. Therefore, connecting Delhi with this part of the state is critical,” he said, stressing that past infrastructure investments were a key driver for Haryana’s growth.

Warning the state that since the capital can’t grow any more, the entire spillover of capital and resources would be Gurgaon and areas beyond that in Haryana.

“I think it is high time that a second and third route of commuting between Delhi and this part is immediately thought of and put into operation. Our program today started late, because I was 20 minutes late thanks to the NH8. Actual time taken is much more than anticipated, and therefore, we have to think afresh,” the minister said, adding that governments must now think of new infrastructure projects ‘well in advance’ rather than wait for the situation to reach a tipping point.

The civil aviation ministry, Mr Jaitley said, is drafting a report on regional air connectivity to revive 160 airstrips under state government control that were built during the Second World War and 25 airports run by the Airports Authority of India that are not being used. The policy, he said, will identify where connectivity would help on the basis of increased traffic potential.

The finance minister also referred to his Budget announcement to scrap the ‘permit Raj’ in state transport systems so that private entrepreneurs can operate transport buses. “This could not only help people, but also create employment opportunities, especially for people in the rural areas who have inadequacies in terms of employment,” he said.