States will have to Compete for Central Projects

The Centre has decided to adopt the so-called challenge method for awarding all projects to states so as to bring in speed, efficiency and transparency, besides putting an end to allocation of big projects on political consideration. Prime Minister Narendra Modi has approved Niti Aayog's proposal for using the challenge method for awarding projects to states. Under this method, prospective states will be rated on more than half-dozen parameters prescribed in the guidelines issued and the project will go to the state with the highest score on a scale of zero to 100.

This is expected to spur competition among states and UTs, both in terms of offering the best sites and committing resources in terms of land, utilities, infrastructure support and financial contribution, which in turn would encourage optimum utilisation of scarce resources and help in timely completion of projects.

The challenge method for selecting the state as well as the site for the projects, which can be both brownfield and greenfield projects, will now be applicable across sectors such as aviation, roads, railways, health, education, IT, power and textiles. It will also be used for awarding all national events such as national games and youth festivals to states.

Following the PM's approval, detailed guidelines have been issued outlining the basis for setting up new IITs, IIMs, AIIMS, IT and textile parks, new roads and airports as well as thermal plants.

The government is of the view that in many instances projects along with locations used to be announced in the Budget or as a development package while the formulation of the scheme, land acquisition got done after the announcement.

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