CHENNAI: The Chennai Metro Rail has set up a deadline of seven years to complete the Rs 20,196-Phase II of the project. But will the deadline be feasible when the first phase has overshot many a deadline due to land acquisition issues and plagued by contractors abandoning the project and many going in for arbitration?
While a Chennai Metro Rail spokesman says that the first phase and the Phase I extension has been a learning curve which could help in implementing the Phase II in a better way, questions remain over contract failures in such urban infrastructure projects.
K Subramanian, one of the sole Indian representatives in the Dispute Resolution Board Foundation of United States, says that major disputes arise due to extended stay cost, change in scope and law and price escalations and this leads to issues like delay in site handover, design approval and inadequate engineering at the detailed project report stage.
He says that many of the contract documents adopted in the Indian context, are unbalanced and loaded against the contractors. This also leads to major disputes which delays project implementation.
Subramanian, who is also the executive vice chairman of Afcons, says that Chennai Metro in Phase-II can adopt more balanced contract documents like yellow book, of FIDIC. “Already some Metro clients like Ahmedabad Metro have adopted these documents and this has proved beneficial,” he says. Overseas, United Kingdom and Australia have set up dedicated courts for resolving construction related disputes. “Such fast-track courts should be formed in India also,” he says.
The amended Arbitration Act, 1996, which forbids employee arbitrators and setting up the deadline for completing the arbitration, has been a major welcome initiative by the government, in dispute resolution, says Subramanian, whose organisation is bidding for the second phase.
Chennai Metro Rail spokesman said that the second phase is likely to have changes in awarding of contracts. “We will be dividing the works in a particular station and awarding it to contractors unlike the earlier phase wherein contract was awarded in packages.”