With analysts at both Indian and global broking houses using CMIE data to help them take stock of investment trends, the government is engaged in protracted discussions with the business information company to review the datasets as well as the methodology used. CMIE data has, for some time now, reflected that business sentiment in the country remains subdued but the government wants to project a more rosy picture. It is particularly keen to show that the data on stalled projects is not as bad as has been made out.
Several meetings have already been held between the two. The government is arguing that in some instances the projects have been stalled for much more than two years — before the NDA came to power in May, 2014 — and in several it is arguing these were mere announcements and not projects per se.
Of the `11.5 lakh crore worth of projects listed in CMIE’s CapEx database as stalled, a subset of 45-50 projects that have a capital cost of `5 lakh crore has been shortlisted for detailed scrutiny — roughly a fourth of these projects are described by CMIE as stalled due to promoters not being interested or not having the funds, reasons which the government cannot possibly be responsible for.
The data is not all one-sided, though — while the number of investments added during each quarter is falling, the number of stalled projects is rising at a slower pace, the number of projects stalled in each quarter is falling and the number of stalled projects in each quarter getting revived is increasing (see graphics).
CapEx is a fluid database and information is collected through a combination of regulatory filings, replies to questions in Parliament and newspaper announcements, among others. As such, a project listed as stalled in one quarter can be re-categorised as revived in another, and vice versa. Some of the disputes between the government and CMIE fall in this category.
In the case of the `3,000 crore Dholera Special Investment Region project, CMIE classified the project as stalled in the December 2015 quarter, following a Gujarat High Court order stopping work on the project. In the March 2016 quarter, however, when an order was awarded to L&T, the project was shifted to the revived category. In the case of MSRDC’s `5,000 crore Bandra-Versova-Virar sea-link project, it was categorised as stalled when the government was said to be considering a coastal road instead, but marked as active when bids were invited in the December 2015 quarter.
The government has asked CMIE to consider the `20,000 crore Surguja ultra-mega power plant (UMPP) as stalled since 2010 and even cited the Power Finance Corporation as withdrawing its tender for the project in 2013 — in which case, the project cannot be considered as being stalled after this government came to power as CapEx says.
Yet, the ministry of power’s annual report for 2013-14 categorically says “the UMPPs under progress are Orissa Integrated Power Limited (OIPL), Chhattisgarh Surguja Power Limited (CSPL) …” A Lok Sabha reply on July 23, 2015 and a Rajya Sabha one on August 10, 2015 also say “Ministry of Coal vide letter dated 8.4.2015 has tentatively recommended coal blocks”, suggesting that the project has been stalled in the last two years.
In the case of the Rs 15,000 crore Banka thermal power plant, the government has told CMIE that the project has seen no progress since the end of 2012. On February 6, 2014, however, a Lok Sabha reply – and a Rajya Sabha one five days after this – cites the status of the project as ‘under construction’. A few months later, on July 2014, a Rajya Sabha answer described the situation at the project as “No work is going on at site, likely slip to 13th Plan”.