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Report on Infrastructure Opportunities in South India Introduction: Indias rapidly growing economy has been placing huge demands

on power supply, roads, railways, ports and transportation systems, and infrastructure deficiencies have become glaring. Overstretched infrastructure is apparent in Indias congested highways, longer turnaround time at seaports and frequent power cuts. Infrastructure bottlenecks impede growth of the economy, hamper business activity and raise the cost of energy and logistic. The government has taken many initiatives to develop the sector. It is also reflected in the budget 2011-12. Government initiative for the development of Infrastructure sector Projected investment required for infrastructure development during the 12th Plan period (2012-17) is Rs 40.99 trillion. The infrastructure sector has been allocated Rs 2.14 trillion for 2011-12. The Energy sector has been allocated Rs 155,495 crore for 2011-12. Tax free bonds of Rs 25,000 crore, which includes Rail & Road with Rs 10,000 Crore each and ports with Rs 5000 Crores

South Indias rapidly growing economy has been placing huge demands on roads, railways, ports and transportation systems, and infrastructure deficiencies have become glaring. Infrastructure bottlenecks impede growth of the economy; hamper business activity and logistic costs, eroding the overall competitiveness. Confederation of Indian Industry SR has been working closely with the state governments by way of policy recommendations, investment promotions and Industry government collaboration for Infrastructure development in the states. This is a compilation of the immense opportunity South Indias Infrastructure sector presents.

Road & MRTS India has the second largest road network in the world with approximately 3.3 million km. Roads are the preferred mode of transport, accounting for 85% of passenger traffic and 65% of freight. The network comprises national highways, state highways, major district roads, expressways and village roads. National highways comprise only 2% of the countrys road length but carry 40% of the traffic. State highways and major district roads carry 40% of the total road traffic and constitute 13% of the road length. The number of vehicles is growing at a rate of 10.6% annually and inclusive of commercial traffic it is growing at 30% p.a. This puts enormous pressure on road infrastructure.

Growth in passenger traffic at 85 per cent and freight traffic at 65 per cent will also increase the demand for roads. Currently, India has among the highest spend on logistics 17 per cent of GDP. Lack of quality road transport is among the major drivers of this cost. National highways form 2 per cent of the total road network, but carry 40 per cent of total traffic. Only 25 per cent of national highways are 2-lane or 4-lane and 80 to 90 per cent of highways are structurally inadequate to support the 10.2-ton permissible load per axle that trucks are allowed to carry. Average possible speed on Indian highways is only 30 to 40 km/hour, reducing average distance travelled by trucks per day to around 200 km compared to the world average of 600 to 800 km.

The National Highways Development Programme is expected to cover 50,000 km of national highways, at a cost of USD 65 billion. Of this, about 13,000 km is in South India. In addition to this, several state highways and port-linkages have to be improved. This will help support the growth of the high-density industrial clusters and the high-growth freight corridors that connect these.

Government Initiatives: The government has announced several incentives: In the recent Budget 201011, the Government of India has proposed US$

4.1 billion for road transport, representing an increase of 13.4 per cent over the previous year Foreign Direct Investment up to 100 per cent in road sector Government to bear the cost of the project feasibility study, land for the right

of way and way side amenities, shifting of utilities, environment clearance, cutting of trees, etc Provision of subsidy up to 40 per cent of project cost to make projects viable.

The quantum of subsidy to be decided on a case-to-case basis. 100 per cent tax exemption in any consecutive 10 years out of 20 years after

commissioning of the project. Duty free import of high capacity and modern road construction equipments. The government has also announced an increase in the overseas borrowing

amount of infrastructure sectors, to US$ 500 million from US$ 100 million.

As per the Economic Survey, the Ministry of Road Transport and Highways,

with a view to expediting the progress of the NHDP, has set a target of completion of 20 km of national highways per day, which translates to 35,000 km at the rate of 7,000 km per year during the next five years (2009-14).

Opportunity in Andhra Pradesh The GOAP proposed a second project i.e. AP Road Sector Project with the loan assistance of World Bank for improvement and better management of the roads chiefly targeted to further strengthen the objectives set forth in the previous project Cost of the project is estimated at Rs 3165 Crore. Project duration 5 years from signing of loan agreement (2010-2015) Construction work on Hyderabad metro rail will start in a month's time. The design work is being done simultaneously and tendering process for rolling stocks is currently underway. 200 coaches are required initially. Within 3 to 4 months, orders will be placed and it will take may take one-and-a-half years for the firm, which will be shortlisted, to make the coaches and another six months for the trail run. NHAI is going to take up a pilot project, Vijayawada-Machlipatnam on e-tendering basis and all tenders beginning from August this year will be through e-tendering only. Opportunity in Karnataka The state has the index to improve from 1.07 Km/Sq. Km to 1.5 Km/Sq. Km( by FY 2020) The State requires an investment of up to Rs 125000 Crore by 2020. Karnataka has planned to develop 15,000 km road at cost of Rs 13,362 Crore. The works included strengthening 1,446 km of roads, widening of 1,054 km, laying 7,500 km of new roads, upgrading 2,000 km of roads. Provision of Rs 632 crore under State schemes for upgradation of another 5000 km of rural roads Karnataka Road Development Corporation Limited is desirous to develop State Highways and major district roads of about 10,000 km in Karnataka with public -

private

participation.

The Karnataka government has set up a fund for providing financial assistance to state agencies taking up infrastructure projects under the public-private partnership (PPP) model. The new fund, called the Karnataka Infrastructure Project Development Fund (KIPDF), has been created under the department of infrastructure. The Karnataka government has identified about 25,000 km of the most important traffic corridors and designated them as the state's core road network. However, 39 per cent of the core road network requires improvement to bring it into good or fair condition, according to a road condition survey.

Karnataka government has proposed Rs 4,770-crore package to help provide adequate infrastructure for the growth and development of Bangalore.

The Bangalore Metro Rail Transit System Project (BMRTSP) has a total cost of USD 2.7 billion and is scheduled to be completed in 2013. Besides the ADB loan, the Bangalore metro project is also being funded by the Japan International Cooperation Agency.

The government today earmarked a substantial amount to the Urban Development Ministry for spending on extension of Metro networks in Bangalore in the Budget 2011-12. While the equity to Bangalore Metro's equity is Rs 600 crore in the 2011-12 fiscal.

Development of High Speed Rail link to Bangalore International Airport at an estimated cost of Rs 6736 Crore Development of Monorail in Bangalore at a cost of Rs 3400 Crore

Karnataka has index to improve from 16 rail km/1000 Sq. Km to 32 rail km/1000 Sq
Km by 2020, with a capacity addition of 3407 Km, and required investment of Rs 22000 Crore by 2017 The State requires 134 Km of MRTS, which would require 27,000 Crore by 2017

Opportunity in Kerala

There are 8 national highways and 76 state highways The State budget earmarking Rs 202 crore to improve and widen the roads and junctions in Kochi The traffic of the state has been growing steadily at the rate of 10 11% every year, resulting in increasing the pressure on the roads of the state The productivity loss and increased fuel consumption in Trivandrum-Kochi highway is estimated about Rs.2700 crore annually due to the congestion and lower speeds of vehicles. Opportunity in Tamil Nadu To upgrade road infrastructure, the State Government is implementing a World Bankfunded project at a cost of US$ 500 million

The government today earmarked a substantial amount to the Urban Development


Ministry for spending on extension of Metro networks Chennai in the Budget 201112. The Comprehensive Road Infrastructure Development Programme (CRIDP) scheme contemplates road improvement and widening works in a massive scale with huge outlay to a tune of Rs.1000 crore per year. Under the Chennai Metropolitan scheme of Traffic and Transport Improvement in Chennai Metro area, improvements to 590 Km length of roads including construction of Grade Separators, Bridges, Center Medians and Footpath at a cost of Rs. 825 crore has been taken up. Improvements to Major District Roads and Other District Roads- Under this scheme, improvements to Other District Roads/ Major District Roads and construction of bridges have been taken up with NABARD loan assistance for the benefit of rural sector. The construction of Road Over/ Under Bridges in lieu of existing level crossings on government roads are undertaken on priority basis when Train Vehicle Units (TVU) exceed one lakh per day. The State Government and Ministry of Railways share the cost equally for construction of Railway Over/ Under Bridges including approach and service roads. The government has issued orders for the extension of the IT Corridor from Siruseri to Mamallapuram as Phase II and has sanctioned Rs.70 crore for land acquisition. This project covers the stretch from Egattur to Pooncheri near Mamallapuram for a

total length of 26.80 Km including two bye-passes at Padur-Kelambakkam and Thiruporur. The land acquisition is in progress.

Projects State-wise National Highway development projects available for financing in Andhra Pradesh Project Vijayawada - Machalipatnam Yadagiri-Warangal Mah/KNT Border-Sangareddy Vijaywada-Elluru-Rajamundry Ichhapuram-Srikakulam-Anandpuram Vishakhapatnam-Anakapalli Anakapalli -Tuni Tuni -Dharmavaram Dharmavaram-Rajahmundary Nellore Bypass Tada - Nellore Length(Km) 63 96 145 198 213 50 59 47 53 17 111 INR in Crore 618 912 1378 1980 2130 500 590 470 530 170 1110 NHDP Phase III IV IV V V V V V V V V

State Highway development projects available for financing in Andhra Pradesh Project Name with State Highways No Length ( Km) Two-laning of Mahaboobnagar-Nalgonda Two-laning of Rayachoti-Angallu Two-laning of Eluru-Machilipatnam Two-laning of Kurnool-Guntur 163 60 43 115 Estimated ( Crore) 571 210 151 403 Cost

Four-laning of AnakapalliAnandapuram Four-laning Kovvur Kadapa-Renigunta Road (SH-31) Four-laning of Warangal-Khammam Four-laning of PerecherlaThokapalli Khammam-Tallada-Devarapalli Khammam District Road of Gundugolanu-Devarakonda-

48 68

368 456

137 118 133 in 172

779 621 628 942

National Highway development projects available for financing in Karnataka Project Mulbagal - Karnataka/AP Border Hospet-Bellary-KNT/AP Border Shimoga-Mangalore Hasan-BC Road Gulbarga-Bijapur-Homnabad Hospet-Chitradurga Hospet-Hubli-Ankola Gundlupet-TN/KNT Border Hoskote - Dobespet Tamil Bangalore Mah/KNT Border-Sangareddy Khagal Belgaum Neelamangala -Tumkur Dharwad Haveri Haveri-Chitradurga 145 77 35 95 135 1378 770 350 950 1350 IV V V V V Nadu/KNT Length (Km) 22 93 188 130 200 119 271 27 89 Border- 204 INR in Crore 209 884 1786 1235 1900 1131 2575 81 846 612 NHDP Phase III IV IV IV IV IV IV IV IV IV

Tumkur & Chitrdurga Bypass

31

310

State Highway development projects available for financing in Karnataka Project Name with State Highways No Length ( Km) Kumta-Tadas (SH-69) Yalahanka-Gauribidanur-AP Border (SH-9) Kadur-Chikamangalur-Mudigere-BelthangadiBantwal (SH-64) Zaheerabad-Nanded, Srimandal (SH-75,04, 15 & MDRs) Bidar-Humnabad, Maniknagar-Ghodwadi,HulasurKudalgi - Sandur to Torangal Sandur - Hospet SH-58 near Chintamani -Tadgal cross to AP Border and Tadgal cross- Govinapalli to AP Border NH-63 near Ginigere-Gangavathi-Sindhanoor SH-20 from Lingsugur- Kalmala to Raichur Shimoga Honnalli- Harihara SH-13 bridge Turuvekere-Sira 85 221 145 from AP Border near Devsugur 83 90 78 58 83 86 78 56 113 46 27 58 226 158 72 58 Bhalki-Chincholi, 215 430 128 75 162 Estimated ( Crore) Being determined 150 324 Cost

Wanamarapalli-Raichur,Miriyan-Chincholi,Bidar-

Chikkasugur Raichur Yergera to Mantralaya

Development of road from NH-63 near Gadag 69 Mundargi to Koppal SH-63 from Sanakanur Bevoor- Rampur to 68 Kanakagiri

140

SH-35 from Tamilnadu border-Anekal Sarjapur 55 Hoskote NH-4 near Hoskote Santhe circle to Chintamani and Santhe circle Jangamakote to Chintamani Tawaregere Kanakgeri-Gangawati Kampli to 84 Kudithini Hospet Kamalapura- Kampli-Ittigi Mysore Malavalli Maddur-Kunigal Tumkur Tumkur- Koratagere Madhugiri- Pavagada AP Border Harihara Harappanahalli-Kudalgi 86 44 152 128 84

277

89

241

122 349 275

140

Some of the upcoming projects are Peripheral road, Construction of Underpass at Magadi Road - Chord Road junction and many more.

A Peripheral Ring Road of about 110 Km. length is proposed around Bangalore at a redial distance between 2.80 to 11.50 Km. from the existing Outer Ring Road. The project involves a land acquisition of about 2050 Acres and is expected to cost Rs. 550.00 crore. Authority has approved the proposal of construction of an Underpass at Magadi Road - Chord Road junction at an estimated cost of Rs. 2250.00 lakh with construction of flyover and other places.

Four-lane road between the twin cities of Hubli Dharwar at an estimated cost of 50
Crore Other projects are S No Project Name Length Km 1 2 Puthalapattu - Naidupet Road Up-gradation and Improvement of road from Nellore to Gooty Road via Badvel Mydukur Rayalacheruvu. 3 Up-gradation of road from Anakapalli to 48 455 58 194 Estimated Cost ( Crore) 306.00 962

Anandapuram (SH-38) via Sabbavaram 4 Up-gradation of road Gundugolanu - 68 531

Devarapalli - Kovveru

National Highway development projects available for financing in Kerala Project Walayar -Vadekancherry Thiruvananthapuram Border Kuttipuram - Edapally Cherthalai - Ochira 116 84 1102 798 III III TN/Kerala Length(Km) 54 43 INR in Crore 513 409 NHDP Phase II III

National Highway development projects available for financing in TamilNadu Project Madurai Parmakoti Length(Km) - 116 INR in Crore 1,100 NHDP Phase III

Ramanathapuram Tindivnam - Krishnagiri Nagapattnam -Thanajavur Kerala/TN Border- Kanyakumari Coimbatore - Mettupalayam Karaikkudi - Ramanathapuram Vikravandi -Thanjavur Thanjavur Pudukkotai 122 366 IV Kumbakonam 178 77 65 54 80 165 624 268 618 513 280 495 III III III III III IV

Sivaganga - Manamadurai Dindigul - KNT/TN Border Tiruchirapalli Lalgudi Chidambaram & Meenusuriti 266 135 798 405 IV IV

Jayamkondam - Kootu Road Viluppuram Pondicherry Nagapattnam Coimbatore-TN/KNT Border Walahajapet - Poonamallee Tambaram - Tindivanam 103 93 93 309 930 930 IV V V 194 1,843 IV

State Highway development projects available for financing in TamilNadu Project Name with State Highways No Length ( Km) Mettur-Palakkanthu-OddanchatramDharapuram- Tiruppur (SH-174) Erode- Dharapuram (SH-83A) 78 126 Techno Economic Feasibilty study is yet to be awarded Techno Economic Feasibilty study is yet to be awarded Arcot bypass road 4 Techno Economic Feasibilty study is yet to be awarded Erode outer ring road, Phase-II 10 Techno Economic Feasibilty study is yet to be awarded Chennai outer ring road, Phase-II 33 Techno Economic Feasibilty study is yet to be awarded To improve the road and bridge infrastructure in fast developing industries in Sriperumbudur area of Kancheepuram District, the government has sanctioned the following works at a cost of Rs. 300 crore. Widening Singaperumalkoil Sriperumpudur road (SH-57) (24.60 Km) to four lane in the First Phase and widening Oragadam to Sriperumbudur road to six lane in Second Phase. Widening of Vandalur Wallajabad road (SH-48) (33.40 Km) to fourlane. A Bye pass for Ponthur Village for a length of 2.39 Km in Singaperumalkoil Sriperumbudur Road Construction of a Grade Separator (over bridge) at Oragadam junction Estimated Cost ( Crore)

Service road for 3 km on four sides of the junction at Oragadam

Ports & Shipping Indian Port sector consist of 13 Major ports and 176 Minor ports. Ports play a vital role in the overall economic development of the country. About 90% by volume and 70% by Value of the countrys international trade is carried on through maritime transport. Development of Indias ports and trade related infrastructure will continue to be critical to sustain the success of accelerated growth in the Indian economy. Shipping sector entails an investment of Rs 5 lakh crore by 2020 to take the Indias ports capacity to 3,200 MT. Out of which, the port sector entails an investment of Rs 3 lakh crore. The Major ports alone require investment of over Rs one lakh crore for 352, to expand their capacity by 767.15 million tons (MT) in the next 10 years. Out of which, Rs 72,878 crore is expected from the private sector. The South India consists of six major ports and 56 minor ports. All the states have port facility in the region. Tamil Nadu alone has three major ports. Kerala has the highest number of minor ports in the region, followed by Tamil Nadu. (Figure 1)

Figure 1: Number of Major and Minor ports in South India

Government Initiatives: The government has announced several incentives:

100 per cent FDI under the automatic route for Port development projects 100 per cent income tax exemption for a period of 10 years Standardization of bidding documents to ensure uniformity and transparency in the award of projects

The Model Concession Agreements have been standardized and simplified The tariff setting mechanism has been modified with tariffs being set upfront by Tariff Authority for Major Ports (TAMP)

Bidding documents have also been standardized to ensure uniformity and transparency in the award of projects

Acquisition of all types of ships has been brought under the Open General License.

Formulated plans by major and non major ports to meet the huge traffic are Development of new terminals Upgrading existing berths Modernizing operations by inducting state of the art cargo handling equipment Need for expansion of ports Traffic at major and minor ports are expected to grow at CAGR 8 and 16 per cent respectively, which in turn would reach traffic of 1215 and 1270 MT respectively, in the year 2019-20. Considering the objective of 70 per cent capacity utilization, it is necessary to increase the overall capacity of Indian Ports to 3230 MT by 2020 which is more than three times the present level of 963 MT Areas to be focused on Government should give more attention and policy support to the major state-run ports, which have seen decline in share in cargo handling compared to the minor ports. Ports require infrastructure to handle worlds biggest cargo ships. The trans-shipment results in additional port fees and delays, all adding to costs on trade. Today, over 40% to 45% of the country's containerised cargo is trans-shipped through Colombo,

Dubai or Singapore. International Container Trans-shipment Terminal is the initiative by the government to solve the issue. The Indian port sector is facing choppy waters as big-ticket expansion projects worth close to Rs 10,000 crore have been stranded, awaiting environment clearances. The major port projects stuck due to environmental clearance include the Rs 3,600-crore container terminal project at Chennai. Public Private Partnership in Port Sector Private Capital through PPP projects has been achieved in the Port sector because of a favorable and investment friendly policy framework that was put in place by Government of India. As a result, 24 PPP projects involving an investment of Rs.6,486 crore have been completed and are under operation. Another 19 PPP projects are under implementation involving an investment of about Rs.12,498 crore and 21 more projects are under bidding. These projects include International Container Terminals at JNPT, International Container Transhipment Terminal (ICTT) at Vallarpadam, LNG Regasification Terminal at Cochin, Mega Container Terminals at Chennai and Ennore, new coal berths in Paradip, Tuticorin and Vizag among others.

Investment

Opportunity

in

the

Major

Ports

of

South

India

Figure 2: Investment Opportunity in Major Ports of South India, Source: Maritime agenda 2020, Ministry of Shipping

The investment plan of Visakhapatnam Port Trust is Rs. 3373.22 crore for 27 projects in phase I, Rs. 6465.00 crore for 19 projects in phase II and Rs. 4100.00 crore for 10 projects in phase III. Of the above investment plan, the private investments have been earmarked as Rs. 2262.08 crore in phase I, Rs. 3830.00 crore in phase II and Rs. 1000.00 crore in phase III. Ennore Port has envisaged an investment plan of Rs. 1636.92 crore for 6 projects in phase I, Rs. 3622.00 crore for 5 projects in phase II and no project for phase III. Of the above investment plan, the private investments have been estimated as Rs. 100.00 crore only in phase II. Chennai Port has chalked out an investment plan of Rs. 5224.04 crore for 9 projects in phase I, Rs. 4231.00 crore for another 13 projects in phase II and Rs. 1125.00 crore for 7 projects in phase III. The investments from Private Sector for the three phases are Rs. 4262.24 crore in phase I, Rs. 2911.00 crore in phase II and Rs. 795.00 crore in phase III respectively.

Tuticorin Port has envisaged an investment plan of Rs. 1154.55 crore for 7. projects in phase I, Rs. 1444.32 crore for 6 projects in phase II and Rs. 3907.00 crore for 11 projects under phase III schemes. The provisions of private sector investment for the above projects are Rs. 873.08 crore in phase I, Rs. 664.32 crore in phase II and Rs. 1200.00 crore in phase III. Cochin Port has envisaged an investment plan of Rs. 511.00 crore for 6 projects in phase I, Rs. 2371.40 crore for 18 projects in phase II and Rs. 3999.10 crore for 14 projects in phase III. The investments from private sector have been planned as Rs. 397.00 crore in phase I, Rs.1840.00 crore in phase II and Rs. 2900.00 crore in phase III. New Mangalore Port has envisaged an investment plan of Rs 378.90 crore for 3 projects in phase I, Rs. 1147.00 crore for 3 projects in phase II and Rs. 390.00 crore for 1 project in phase III. The private investment for phase I and phase II have been projected as Rs. 299.73 crore and Rs. 850 crore respectively. No private investment has been planned in phase III. Investment Opportunity in the Minor Ports of South India Southern Maritime states have 56 non major ports. It has drawn ambitious programmes to create additional capacity during 2010-11 to 2019-20.The states have identified projects for development of non major ports at an estimated cost of Rs 49107 crore for creation of additional capacity of 316.82 million tonnes. Private sector is envisaged to fund most of the projects through PPP or BOT or BOOT basis. It is envisaged that private sector will meet 96.1% of the cost of development. Remaining requirement is planned to be contributed by State Governments through Internal Resources / Gross budgetary Support/ Internal Extra budgetary Resources.

Figure 3: Traffic Forecast of Minor Ports in South India, Source: Maritime agenda 2020, Ministry of Shipping

From the traffic forecast chart above, it is apparent that minor ports of Andhra Pradesh would see a huge volume of traffic in 2019-20. The traffic volume of Andhra Pradesh, Karnataka, Tamil Nadu and Kerala would be 202.04, 67.4, 45.4 and 27.27 MT in the year 2019-20. Thus Andhra Pradesh ports require a huge volume of capacity addition in order to face the demand. The state is followed by Karnataka and Tamil Nadu.

Figure 4: Capacity addition in Maritime states of South India, Source: Maritime agenda 2020, Ministry of Shipping

In terms of investment, Andhra Pradesh requires around Rs 33540 Crore by 2020. Tamil Nadu, Karnataka and Kerala require Rs 7576 Crore, Rs 6831 Crore and Rs 1160 Crore respectively.

Figure 5: Investment Opportunity in Minor Ports of South India, Source: Maritime agenda 2020, Ministry of Shipping

The investment required is also very huge, compared to other three states. Business Opportunity Shipping Corporation of India plans to acquire 110 vessels of 5.21 million gross tonnage (GT) at an estimated cost of Rs 27,668 crore in next 10 years. The Shipping Corporation is likely to place orders for 26 vessels by 2011-12. Government is preparing a policy to bring in private players in the sphere of underground excavation in the marine sector; thereby ending the monopoly of the state owned Dredging Corporation of India DCI. The Visakhapatnam Port Trust will award contracts worth Rs 2,000 crore in the current fiscal for mechanisation and dredging to help augment the capacity of India's second-largest port by 36%.While six projects would be taken up to develop berths through public-private partnership, two are dredging projects using internal resources. 15 projects are under development at the three major ports of Tamil Nadu -- Chennai Port, Ennore Port Ltd Tuticorin Port, at an estimated cost of Rs 3,952.75 crore. The government has approved three more projects at these three ports with an envisaged investment of Rs 665 crore The Public sector Cochin Shipyard Ltd is proposing to expand its existing capacity through a shiplift system with an investment of Rs 500 crore. The new system is likely to come up at the northern end of the CSL estate and would be 120 metres long and able to accommodate ships up to 6,000 tonnes. New Mangalore Port Trust will build a new berth and invite the private sector to install the necessary infrastructure for handling container cargo. Besides, it has also decided to float fresh tenders from the private sector for providing infrastructure like cranes and other equipment for handling container cargo separately. The cost of building the new berth is estimated at Rs 50 crore. The Kerala Government is expected to request Petronet LNG Ltd to enhance the installed capacity of its LNG Terminal in Kochi to 15 MMTPA from the existing 5MMTPA.

The Industry expects the demand of LNG would be 25 MMTPA in the year 2015,
while supply from LNG terminals in Dahej, Surat and Kochi will be in the range of 17.5 MMTPA.

The Gangavaram Port is about to increase its capacity from 31 MT to 45 MT, by spending Rs 1200 Crore. It has planned to raise Rs 900 crore through lenders and Rs 300 crore by promoting equity. Development of Port at Tadadi, Uttara Kannada at an estimated project cost of Rs 3000 Crore Projects: Some of the port projects under planning/bidding through BOT structure are

Project Name

Department/Agency

Est. Cost (In Rs Crore )

Installation of Mechanised handling facilities for Visakhapatnam Port fertilizers at EQ 7 in the Inner Harbour Development of WQ 7 for handling Import Dry bulk Visakhapatnam Port cargo Development of WQ 8 for handling break bulk cargo and export bulk cargo Installation of Mechanised Iron Ore handling Visakhapatnam Port Visakhapatnam Port

217.58

180.00

230.00

275.20

facilities at WQ-1) in the northern arm of Inner harbour of VPT for handling Dry bulk cargo Creation of Mega Container Terminal Development of RO-RO cum multi-purpose berth & car parking at Bharthi Dock Development of Barge jetty at Bharthi Dock Construction of Shallow draft berth for handling cement Upgradation of mechanical handling equipments in VOC Port, Tuticorin berth no.1 to 6 and berth no.9 Constn. of shallow draught Berth(2 Nos) for handling construction materials Conversion of berth no- 8 as Container Terminal VOC Port, Tuticorin 312.23 VOC Port, Tuticorin 56.17 80.10 Chennai Port VOC Port, Tuticorin 25.00 86.17 Chennai Port Chennai Port 3686.0 100.00

Development of NCB-III for handling thermal coal & VOC Port, Tuticorin rock phosphatat V.O.C. Port Trust Development of NCB-IV for handling thermal coal & Copper concentrate. Container of container truck parking terminal, CFS & VOC Port, Tuticorin Elevated Express way International Bunkering Terminal - Construction of Cochin Port Multi-purpose Liquid Terminal Source: Ministry of Shipping VOC Port, Tuticorin

420.0

355.0

150.00

206.30

Civil Aviation Indian aviation sector is one of the fastest growing aviation in the world. The open sky policy has led to many overseas players entering the market and industry has been growing both in terms of players and numbers of aircrafts. Indian Civil aviation is the 9th largest aviation market in the world. It is predicted that international passengers are expected to grow up to 50 million by 2015. The Vision 2020 statement created by the Ministry of Civil Aviation, envisages creating infrastructure to handle 420 million passengers by 2020. Investment opportunities of US$ 110 billion envisaged up to 2020 with US $ 80 billion in the new aircraft and US $ 30 billion in the development of airport infrastructure. Government initiatives The Government of India (GoI) has approved the policy for Greenfield airports in April 2008 to enable the development of Greenfield airports in the PPP mode. The Planning Commission has also developed a model concession agreement (MCA) to enable state governments to develop Greenfield airports under the PPP mode. The GoI has allowed 100 per cent FDI under the automatic route for Greenfield airports. For existing airports, 100 per cent FDI is allowed. However, for FDI exceeding 74 per cent, approval is required from the Foreign Investment Promotion Board (FIPB).

The capital expenditure is funded through private equity, borrowings, and internal resources of joint venture companies. As per the Economic Survey of 2010-11, out of 35 airports granted in 2006, 11 have been completed, while the remaining are under implementation. The adoption of Open Sky Policy has resulted in the entry of several new privately owned airlines and increased frequency / flights for international airlines. South India- performance and future For the past four years, South India is the only region which is dominant in handling Aircraft traffic. (Figure 1).The region handled nearly 4.5 lakh of aircraft during the financial year 2010-11. It is followed by western region and northern region, who handled nearly 4 and 3.5 lakh aircrafts during the same period. But, for the past two years, Unlike in Northern region, there is no prominent growth in the aircraft traffic in the south India. It is a sign of maturation, and it could be handled by expanding the airports, in order to increase more aircraft movement in the region. Northern region is having enormous growth in handling aircraft traffic.

Figure 2: Aircraft traffic in various region of India. Source: AAI

Revenue is generated by the passenger traffic and freight traffic in the region. In terms of passenger traffic, there is a close completion between the southern region and western region (Figure 2). For the past too years, there is a huge growth in the passenger traffic in the entire region of the country. It shows the interest of the travelers in choosing aircraft as a mean. This is the right time to develop and expand airports, for exploiting the opportunity. The Southern region handled passenger traffic of around 45 million.

Figure 2: Passenger traffic in various region of India. Source: AAI

In term of freight traffic, again there is a competition between southern and western region. Until July 2009, the western region performed well in handling freight traffic. It does not last for long. Since the period, Southern region dominated the freight market. The southern region handles nearly 8 lakh tons of freight traffic, which is followed by western region who accounts for around 7.5 lakh tons, during 2010-11. ( Figure 3)

Figure 3: Freight traffic in various region of India. Source: AAI

South India- International Airports & their share

South India consists of three international airports, three joint venture international airports, three Custom airports and few more domestic airports. Joint ventures in development of airports have been successful in South India. Out of six joint venture airports, three of them are in South India. The International airports in South India accounts for 90 per cent of South Indias passenger traffic and 98 per cent of the regions freight traffic. So, let us track the performance of these six airports, in order to explore new opportunities.

Figure 4: Passenger traffic in International Airports of South India. Source: AAI

In terms of Passenger traffic, Chennai and Bangalore international airport are having a close competition for the past four years. As on March 2011, Chennai airport lead the Bangalore airport in terms of passenger traffic. The passenger traffic of Chennai and Bangalore Airport is around 12 million and 11.5 million respectively. Hyderabad Airport is also showing a positive sign for picking up.

Figure 5: Freight traffic in International Airports of South India. Source: AAI

With respect to freight traffic, Chennai Airport is the leader in South India. The Airport handles nearly 3.9 lakh tons of freight, during 2010-11. It is followed by Bangalore airport with around 2.2 lakh tons during the same period.

State- wise Airport and their expansion plan. Andhra Pradesh has 6 functional airports. The development of Hyderabad International airport has been developed on PPP mode as Greenfield airport Begumpet airport is suitable for operation of aircraft B747. Apron has enough space to park 13 aircraft at one time. Hyderabad has got a new airport managed by GHIAL. Rajahmundry Airport can support operation of aircraft up to ATR72. Apron has space for parking 2 ATR72 at one time. With construction of new terminal building at the airport, the peak hour capacity will increase to 336 from current capacity of 120. Recent development is construction of an air traffic control tower and a fire station Tirupathi airport can support operation of aircraft up to A321s. Apron can park two A321s and one ATR72 at one time. The current terminal building is suitable for 250 passengers at one time; the new integrated one which is under construction would have a peak hour capacity of 700. A new instrument landing system is being installed. An air traffic control tower and a fire station is at the planning stage Vijayawada airport can support operation of aircraft up to B737. The old Apron can park two A320s at one time and the new apron can accommodate five A321s. Peak hour capacity the terminal building is 75 passengers

Indian Navy operates and maintains the Vishakhapatnam civil enclave airport. The runways can support operation for aircraft up to A330s. The existing apron can park three B737s and the new apron which is not functional so far has eight stands for parking the aircrafts. The peak hour capacity is 125 passengers in the old terminal building , but the new integrated terminal building will increase the capacity close to one 1000 passengers.

Karnataka has four aiports: Bengaluru International Airport, Bengaluru CE, Hubli Airport and Mangalore Customs Airport. The Bengaluru International Airport is the first airport in India constructed through a public-private partnership. Hubli airport can handle operation of aircraft up to ATR42s. The apron has capacity to park five aircraft at one time. The terminal building can handle traffic of 60 passengers during peak hours. Installation of ILS (Instrument landing system) is being planned. Mangalore airport is a customs airport. The runway can handle operation of aircraft up to A321. There is parking space for four aircraft in the old apron and six in the new one. The old terminal building can handle 300 passengers during peak hours, and the new integrated terminal has a capacity to handle 750 passengers during peak hours Kerala has three airports; two of them are managed by AAI and one by Cochin International Airport Limited. Calicut International Airport is suitable for operation of aircraft up to B747. Apron has stand for parking nine aircraft at one time. The terminal building is big enough to accommodate 1600 passengers during peak hours. Trivandrum airport has been equipped with new international terminal building complex, eight parking stands for the aircraft (total parking stands on apron increased to 20 with old 12 stands). The runway of the airport can handle operation of aircraft up to B747. Terminal building at this airport can handle 685 passengers in the domestic side and 1600 in the international side. 120 acres of land has been demanded from the state government for the expansion plan of the Airport. The NITB has been constructed on the 38 acres of land, which has been released by the state government. The new domestic terminal and other facilities will be constructed once the state government releases remaining 82 acres of land. Puducherry airport is suitable for operation of aircraft up to ATR-72-500s. The new terminal building has just been completed, which can accommodate 150 passengers during peak

hours. The parking space is sufficient to house three ATR-72-500s at one time. New air traffic control tower is being constructed.

Tamil Nadu has six airports. Modernization of Chennai airport was under way with the Airports Authority of India (AAI) spending an estimated US$ 446 million, respectively. In Chennai airport, Flights leave for 21 international and 24 domestic destinations from International Airport at Chennai. It has runway suitable for operation of aircraft up to B747. Apron has total parking space of 66 aircraft on domestic side and 10 on international side. Peak hour capacity to handle customers is 96 in Kamaraj Domestic Terminal, up to 2300 in Anna International terminal and 3300 in integrated new domestic terminal. A new integrated cargo complex is in the last phase of construction. The modernization and expansion of Chennai airport is in full swing. In all probability the new facilities at the revamped Chennai airport is likely to be thrown open to the travelling public by the last quarter of 2011 as work is going on great speed. The project cost has been revised to Rs 2015 crore and will include a new domestic terminal spread over an area of 76,000 sq mt and an international terminal in 68000 sq mt even as the existing terminals will continue to be used for passenger traffic. Coimbatore airport is a customs airport and is suitable for operation of aircraft up to A321. International flights leave for two destinations from this airport: Sharjah and Singapore. Apron can park three aircraft on domestic and international side each. Peak hour capacity at the existing domestic terminal is 240 passengers. International terminal is under construction and will have a capacity of 385 passengers once completed. The construction of a new terminal building for international operation in Madurai, which can accommodate 700 passengers during peak hours, has just been completed. Construction of a new ATC building and fire station has been planned. The runway at this airport is capable of operation of aircraft up to A321s. Seventy-three weekly flights are being operated by different service providers for the destination: Bengaluru, Chennai and Mumbai. The old apron can park five aircraft at one time and the new one can park two A321s. The present terminal building can house 108 passengers during peak hours. In Salem, the major development works, extension of runway and allied facilities has been planned. The Present runway can handle operation of aircraft up to ATR72s. The apron at this airport can park two ATR72s at one time and the terminal building can house 83 passengers at most.

Tiruchirapalli airport is a custom airport. Several airlines operate 24 domestic flights for the destination: Chennai and Trivandrum. At this airport, 47 international flights are also being operated. Runways at this airport can support operation of aircraft up to A321-200s or B767200s. The terminal building can house 471 passengers during peak hours. Domestic apron can park three A321s at one time and the international one has space for four aircraft. Award of Greenfield Airports S No Name of the Project Name of the Promoters 1 Bijapur Airport, Kamataka State Government Estimated Investment (Rs. in crore) 24.31

(Initial phase) The Steering Committee has granted "in-principle" approval to Bijapur project subject to conditions that Standard Operating Procedure (SOP) would be formalized between DGCA, AAI and Ministry of Defence regarding air space management for the airport at Bijapur in view of the existing defence operations at Pune and Bidar. The SOP is under finalization. The land acquisition is under process.

Gulbarga Airport,

State Government

13.78 (Initial Phase)

Kamataka The Steering Committee has granted "in-principle" approval to Bijapur project subject to conditions that SOP would be formalized between DGCA, AAI and Ministry of Defence regarding air space management for the airport at Gulbarga in view of the existing defence operations at Pune and Bidar. The SOPis under finalization. The required land for project in respect of Gulbarga has been acquired by the Government of Kamataka. 3 Hassan Airport, Kamataka State Government State Government has acquired the required land for the airport project. 4 Simoga Airport, Kamataka State Government 38.91 (Initial phase) The required land for project in respect of Simoga airport has been acquired by Government of Kamataka. 5 Kannur International Airport, M/s KINFRA Rs.929.50

Kerala The project is being implemented through a separate corporate entity in which the Government or Government agencies have 26% equity holding, 74% of the equity is to be held by the developers or a consortium with the principal developer as the consortium leader. M/s KINFRA has intimated that the final proposal for selection of Technical, Financial and

Legal Consultants for preparation of RFP/RFQ documents for selection of Joint Venture Developers has been submitted to State Government in April, 2009 for approval, which is awaited. Monitorable Targets & Milestones for 2010-11 -Infrastructure sector: Planning Commission, Government of India

Telecom The Indian Telecom sector has witnessed a laudable growth over the past 2 years. It has an overall subscriber base of 787.29 million and a tele density of 66.17%, at the end of December, 2010. With the urban tele density reaching approx 150%, the market has been showing signs of maturity. Rural India is the key target market likely to drive the next round of growth, particularly for voice based services. It is envisaged that rural tele density of 40% would be reached by end of 2014. 3G and BWA are expected to reinvigorate the maturing urban markets and help in bringing balanced growth of economy. The aggressive growth observed by mobile services is yet to be replicated in case of broadband service, where the subscriber base currently stands at about 11 million. The successfully concluded auction of the BWA and 3G spectrum will enhance the wireless broadband penetration across the country and help to connect the remotest locations across India. The government has a vision to provide telephone connection and broadband facilities on demand across the country and at an affordable price and it strives to achieve the same. Achievements of Indian Telecom Industry India has the second largest wireless network in the world after China. The target of 600 million telephones by the end of 11th five year plan has been achieved in February, 2010 itself. Performance of the private players The share of private sector in total telephone connections is now 84.60% as per the latest statistics available for December, 2010 as against a mere 5% in 1999. The fruits of the liberalization efforts of the Government are evident in the growing share of the private sector.

Focus area to tap Data based services like third-generation (3G) and Broad band wireless access( BWA) for matured urban market Voice based services for rural Market Subscriber base in South India

Figure 3: Subscriber base in South India, Source: Department of Telecommunication, as on December 31, 2010

Percentage of Share Share of Wire State/ Region line in the Share of Wireless in the

Country country Andhra Pradesh 6.8 7.6 Karnataka 7.8 6.1 Kerala 9.4 4.0 Tamil Nadu 10.0 8.9 Southern region 39.9 33.8 India 100.0 100.0 Source: Department of Telecommunication, as on December 31, 2010 South India has a share of nearly 40 per cent of the countrys wire line connection and onethird of wireless connection. The region has wire line and wireless connection of around 13.9 million and 254 million respectively. It has played a significant role in the growth of the country. In south India, Tamil Nadu is the leader in wire line connection, which accounts for 10 per cent of the nations wire line connection. The state is followed by Kerala, Karnataka and Andhra Pradesh with 9.4, 7.8 and 6.8 per cent respectively.

Similarly, Tamil Nadu is the leader in wire less connection, with a share of 8.9 per cent of the nations wire less connection. Now, Andhra Pradesh overtook Karnataka and Kerala with a share of 7.6 per cent. Karnataka and kerala account for 6.1 and 4 per cent respectively. Wire line Vs Wire less Share of Wire line in the state Share of Wireless in the state Andhra Pradesh 4.0 96.0 Karnataka 5.6 94.4 Kerala 9.9 90.1 Tamil Nadu 5.0 95.0 Southern region 5.2 94.8 India 4.5 95.5 Source: Department of Telecommunication, as on December 31, 2010

Figure 2: Share of Wire line and Wireless Connection, Source: Department of Telecommunication, as on December 31, 2010

94.8 per cent of South Indias subscribers have wire less connection, against the nations share of 95.5 per cent. Andhra Pradesh is the state, which has the highest per cent of subscribers using wire less connection in the south India. Nearly 96 per cent of the subscribers use wire less connection. From the table, it is evident that, Kerala is the only state in southern region which has nearly 10 per cent of wire line connection and 90 per cent of wire less connection. The share of wire line connection is relatively high, compared to the other south Indian states. It could be due to the inadequate participation of private players in the state.

Number of Subscribers in Urban and Rural part of South India

Figure 3: Telephone connection in Urban and Rural region of South India, Source: Department of Telecommunication, as on December 31, 2010

Note: Chennai is considered as a separate circle. * Chennai is excluded. In South India, Tamil Nadu has the large number of subscribers, followed by Andhra Pradesh, Karnataka and Kerala with around 59.4, 48.7 and 33.4 million subscribers. Tele Density in Urban and Rural region of South India

Figure 4: Tele density in Urban and Rural region of South India, Source: Department of Telecommunication, as on December 31, 2010

Tele density of South India is higher than that of India. Kerala has recorded 96.67 per cent of overall tele density, 228.94 per cent of urban tele density and 51.26 per cent of rural tele density. Lowest tele density was recorded in Andhra Pradesh with an over all tele density of 70.27 per cent.

Growth of Tele density in South India Tele density in south India is growing at an enormous speed. The following charts show the growth of tele density in the past nine months, from March 2010 to December 2010.

Figure 5: Growth of Tele density in just 9 months, Source: Department of Telecommunication, as on December 31, 2010

In terms of Overall tele density, all the south Indian states show a rapid growth in the overall tele density. When it comes to urban tele density, Kerala is showing enormous growth, compared to other South Indian states.

Figure 6: Growth of Urban Tele density in just 9 months, Source: Department of Telecommunication, as on December 31, 2010

Even in the case of rural tele density, there is good growth rate. It shows the uniform growth of the sector in all the parts of the region.

Figure 7: Growth of rural Tele density in just 9 months, Source: Department of Telecommunication, as on December 31, 2010

Number of villages with direct access to telecom facilities

Fi gure 8: Percentage of Villages covered by VPT, Source: Department of Telecommunication, as on December 31, 2010

In South India, 97.8 per cent of villages are covered by village public telephone facility, against the nations share of 96. Andhra Pradesh is the only state in South India, where only 89 per cent of the villages have the facility though they are backed up by the private players

with 1408 connections. Remaining states are doing exceptionally well, by covering 99 to 100 per cent of the villages in their respective region. Opportunity The telecom ministry is likely to provide rural wireless broadband connections to over 5 lakh villages all over the country in one-and-a-half years and will provide a subsidy to both state-owned and private service provider operators from the Universal Service Obligation Fund for this purpose.

The sector will witness up to US$ 55.95 billion investments and the market will cross the US$ 100 billion mark in 5 years. The industry will grow at 12-13 per cent annually The share of Value-Added Services (VAS) in wireless revenue is likely to increase to 12-13 per cent by 2011. Currently it accounts for 10 per cent of the total revenue from wireless industry, with a share worth US$ 2.45 billion-US$ 2.67 billion.

Power South Indias total power demand is currently 33 GW, while available capacity is 31 GW. However, there has been limited addition to the total capacity in the last three years. For instance, Tamil Nadus power generation capacity has remained flat at 5,600 MW from 2007 to 2010, while demand has grown at an average of 12 per cent annually. Further, the high prices of coal and LPG over the past 3 years have made captive power plants expensive and unviable for industries. The total installed capacity of India is 174361.4 MW as on April 30, 2011. The southern region accounts for 27.6 percent of it.

The region is the market leader in the diesel thermal generation and renewable energy source with an enormous share of 78.3 and 50.6 per cent respectively. Tamil Nadu acts as a

role model to the nation in the development of renewable energy sources. The share of Tamil Nadu alone is 31.50 per cent of the total countrys share. Renewable energy source, which is also called as clean energy source is very much welcomed by the nation, to keep the environment clean. Power generation through Hydro, which is also considered as a renewable source is adopted in the region, whose share is 30 per cent. Andhra Pradesh and Karnataka are two states in the southern region, who are dominant in the generation of Hydro power generation.

REGION THERMAL Coal Gas Diesel Total

Nuclear HYDRO (Renewable) R.E.S.@ (MNRE) TOTAL

Share of South India in Per cent 21.6 26.5 78.3 23.0 27.6 30.1 50.6 27.6

RES -Renewable Energy Sources includes Small Hydro Project(SHP), Biomass Gas(BG), Biomass Power(BP), Urban & Industrial waste Power(U&I), and Wind Energy.

The Southern Region has 48073.3 MW of power generation capacity. Tamil Nadu leads by contributing 34 percent of generation capacity of 15515.43 MW, which is followed by Andhra pradesh, Karnataka and Kerala, with 33, 25 and 8 per cent respectively.

Exhibit 1.2: Source: CEA

Exhibit 1.3: Source: CEA

Nearly 30 percent of the regions generation capacity is contributed by the private sector. The contribution of private sector is in a growing phase. Supply- Demand statistics gives a clear picture of the need for more private players in the sector. The State wise peak deficit is as follows. The Peak deficit of Tamil Nadu is very high compared to other southern states, with a peak deficit of 11 per cent. It is followed by Karnataka with 7.3 per cent of deficit. Andhra Pradesh and Kerala have a deficit of 6.3 and 5.8 per cent respectively.

Similarly, State wise energy deficit is tabled below. The Energy deficit is high in Karnataka with 7.6 percent, followed by Tamil Nadu, Andhra Pradesh and Kerala, with 6.5, 3.2 and 1.4 percent respectively.

Due to the rapid increase in demand and slow increase in the supply, the southern region is facing load shedding problem. For an instance, during the month of April 2011, Southern states includes Andhra Pradesh, Karnataka, Kerala, Pondicherry and Tamil Nadu had load shedding up to 1808, 1250, 300, 44 and 3191 MW respectively. On the overall view, Southern region has an energy deficit of 5.2 per cent against the nations energy deficit of 8.5 per cent. Similarly, the region has the peak deficit of 6.4 per cent against the nations peak deficit of 9.8 per cent. The region accounts for 14 and 15 per cent of Indias energy deficit and peak deficit respectively.

With per capita power consumption slated to grow from 900 KWh to 1,400 KWh, base demand for power in South India is likely to be around 50 GW, peaking to 75 GW in 2020. Satisfying this incremental demand will require an investment of USD 50 billion to USD 70 billion. Tamil Nadu will lead the demand for power and the 2530 GW need requires a USD 20 billion to 25 billion investment. Similarly, Andhra Pradesh will require 2530 GW and USD 15 billion to USD 20 billion, Karnataka 1015 GW and USD 10 billion to 15 billion, and Kerala 510 GW and USD 5 billion to USD 10 billion. The Kerala Government will also formulate proactive measures for setting up a 1200 MW power plant using LNG as the feed stock in Kochi. State run Rural Electrification Corp has invited technical bids from domestic and international developers to award Rs 1,300 crore contract for laying transmission system in Andhra Pradesh.

The central government's Eleventh and Twelfth Plans envisage USD 350 billion to 400 billion investment in the power sector for India. These investments will generate 100 GW of additional capacity, and while India is expected to be base demand surplus, it will continue to have a peak demand deficit in 2020. This trend will continue in South India too, and will require a concerted set of actions to be undertaken by the State Electricity Boards (SEBs) and government. There are multiple ways to overcome the peak demand deficit as follows: Relax cap on power trading margins to see increased liquidity and allow many merchant power licensees to start trading operations. Remove transmission bottlenecks by allowing open access to merchant power selling outside the state.

Introduce measures to improve SEB profitability (e.g., removal of pump set subsidies). Encourage the addition of peaking hydro-power capacity and scale up the addition of renewable energy beyond wind power, particularly solar energy. Address transmission and distribution losses through the creation of franchisee models in distribution (e.g., Maharashtra State Electricity Distribution Co. Ltd selected Torrent Power Company as a franchisee in 2007 to distribute electricity in Bhiwandi, Maharashtra for 10 years). Karnataka has the index to improve from 700 KWH/Capita to 1400 KWH/Capita (by FY 2017) Capacity addition from 12146(FY 2011) MW to 18500 MW (by FY 2020) Required Investment: Rs 80,000 Crore by FY 2020 Contribution of Private players Private players accounts for 37496.19 MW of generation capacity in India. Out of which, 39.75 percent are in Southern region. It shows the interest of private sector players in starting a power generation plant in southern region.

Source: CEA Exhibit 1.6

Exhibit 1.7

In southern region, Private players were keener in printing their foot step in Tamil Nadu. 48 per cent of generation capacities of the private players from southern region are in Tamil Nadu. They showed more interest on Renewable energy source with 5812.61 MW of generation capacity. Contribution of Private Players in Southern region in terms of generation capacity (MW) is as follows.

The above diagram clearly explains that, private players are dominant in generating renewable energy source in the state of Tamil Nadu and Karnataka with a share of 83 and 55 per cent respectively. These players were very keen in generating power through thermal source with gas as fuel, in the state of Kerala and Andhra Pradesh with a share of 89 and 84 per cent respectively. Private players should come forward to produce power through renewable energy sources in Andhra Pradesh and Kerala. Nowadays, electricity through renewable energy is very much welcomed in the country, because of its positive impact on the environment. Opportunity India aims to add 17,000 MW of renewable energy in the 12th Five-Year Plan, which would require Rs. 1.5 trillion ($33.6 billion). The country offers cheap loans to companies building alternative energy power plants and provides tax breaks and tariff subsidies to encourage development of the renewable industry. India could produce 45,000 MW of additional solar power, taking total solar power generation to 67,000 MW, by 2022. Solar power prices may drop by 7% a year over the next decade. Cheaper solar power will help cut coal imports by 30%, or 71 million tonnes a year. Power Transmission Karnataka have been identified as the states that receive enough sunlight throughout the year to merit large commercial solar plants. Coastal parts of Kerala, Andhra Pradesh are ideal states to set up small plants for domestic use.

The requirement for power transmission in southern region is also in demand. The following table gives you an overview of the target fixed by the respective states in laying transmission lines for the year 2011-12. RESULT FRAMEWORK DOCUMENT (RFD) TARGET 2011-12: TRANSMISSION LINES Quarter 1 Andhra Pradesh Karnataka Kerala Tamil Nadu Southern Region Opportunity 60 61 0 79 200 SUMMARY Quarter 2 Quarter 3 Quarter 4 Annual 56 254 144 514 584 653 0 1298 12 40 54 106 290 0 280 649 942 947 478 2567

Global tariff bids to award contracts for laying five mega transmission lines worth Rs 6,485 crore. The projects would be bid out by state-run Power Finance Corporation (PFC) and Rural Electrification Corporation (REC). It includes transmission systems to evacuate power from projects at Nagattipatnam in Chennai and Vemagiri in Andhra Pradesh to Kolhapur in Maharashtra and Jabalpur in MP.

Power Transformation The following table gives you an overview of the target fixed by the respective states in adding transformation capacity for the year 2011-12.

RESULT FRAMEWORK DOCUMENT (RFD) TARGET 2011-12: TRANSFORMATION Quarter 1 200 200 0 100 CAPACITY Quarter 2 Quarter 3 Quarter 4 Annual 160 680 0 1040 300 600 0 1100 0 200 450 650 630 200 100 1030

Andhra Pradesh Karnataka Kerala Tamil Nadu

Southern Region Opportunity

500

1090

1680

550

3820

The TANGEDCO has proposed to raise funds by way of private placement of bonds for Rs.500 Crores with option to retain over subscription up to Rs.900 Crore through TANGEDCO Bond Series 1/2011-12 with Government Guarantee for the Financial Year 2011-12 to invest in the capital expenditure of on going Generation, Transmission and Distribution Network.

Projects S No 1 2 3 4 5 6 7 8 9 10 11 12 Power Projects Ennore SEZ Thermal Power Project (2X800 MW) NCTPS Stage III Thermal Power Project (1X800 MW) Nagapattinam Ultra Mega Thermal Power Project (4000 MW) Cheyyur Ultra Mega Thermal Power Project (4000 MW) Thiruvadanai Thermal Power Project (2 x 800 MW) Utharakosamangai Thermal Power Project (2 x 800 MW) Udangudi Thermal Power Station- 2 x 800MW Kattupalli TPS at SEZ in Tiruvallur District (2X800MW) Ennore annexe (1X600 MW) 700 MW Gas based power project - I: Davangere 700 MW Gas based power project - II: Belgaum 700 MW Gas based power project - III : Gadag Estimated Cost Rs.8000 crores Rs.4000 crores Rs.20000 crores Rs.18000 crores Rs.9600 crores Rs.9600 crores Rs 9083 Crores Not Available Not Available Rs 2800 Crore Rs 2800 Crore Rs 2800 Crore

The Koodankulam power plant (2X1000 MW) and Neyveli thermal power station stage II expansion are yet to be commissioned.