Revised Cost Estimate and implementation schedule for National Automotive Testing and R&D Infrastructure Project

The Cabinet Committee on Economic Affairs has approved the revised cost estimate of Rs.2288.06 crore for the National Automotive Testing and R&D Infrastructure Project (NATRIP) in place of the original approved cost estimate of Rs.1718 crore.  The budget escalation of Rs.570.96 crore, includes Rs.427.29 crore by way of grant and Rs.142.77 crore as loan as a part of the revised cost estimate of Rs.2288.06 crore.  The revised cost estimate of Rs.2288 crore includes the additional loan component of Rs.95.51 crore to be provided to offset the lower recovery of the user charges from Rs.118 crore (originally envisaged) to Rs.22.49 crore during the project period.

The CCEA has revised the completion date as 31^st December, 2012 from the earlier approved completion date of 30^th September, 2011.

         The CCEA further approved the following:

• The additional loan sanctioned to the project will be interest free, with moratorium of seven years and to be repaid in eight annual installments thereafter.
• Reallocation of Rs.510 crore, originally under Grant from Auto Cess to Grant from Plan fund, without any additional financial implications. 
• The Governing Council, NATRIP Implementation Society / GB National Automotive Board (proposed) will prioritize the allocation, centre wise, during 2011-12 and 2012-13 taking into account the availability of budgetary provision and the pace of ongoing works and also decide 'the allocation of user charges, as also the apportionment of loan to the various centers. Further, Vehicle Research & Development Establishment’s (VRDE) portion of the user charges may be offset against VRDE's share of loan repayment.

The completion of project will ensure that full bouquet of automotive testing and R&D facilities are available for introduction of higher emission and safety norms by 2015.  This will contribute to lowering of vehicular emissions and improve vehicle safety.  The Project will also lead to manifold increase in the growth of the automotive sector and its contribution to national economy.

Background: 

NATRIP, the flagship project of Department of Heavy Industry (DHI), was approved by the CCEA in July, 2005, with a total investment of Rs.1718 Cr, for up-gradation of three existing automotive testing and R&D centers viz. (VRDE) at Ahmednagar, Automotive Research Association of India (ARAI) at Pune and International Centre for Automotive Technology (ICAT) at Manesar and for setting up of four greenfield centers at Chennai, Indore, Silchar and Rae Bareilly for automotive testing, homologation and R&D. Once completed these centres would house 'state of the art' facilities and enable ushering in latest automobile regulations; both for safety and emissions. The project faced initial hurdles, mainly on account of delays in acquisition of land at various sites, delays in clearances, shifting of utilities etc. These factors have necessitated revision in the scheduled completion dates and cost escalation. Most of these hurdles have now been resolved and the project is expected to be completed by December 2012.

Courtesy : PIB