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The PMGSY, was launched in December, 2000, to provide road connectivity to 1.6 lakh unconnected habitations with population of 500 persons or more (250 in case of hilly, desert and tribal areas) in the rural areas by the end of the Tenth Plan period.
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It is being executed in all the States and six UTs. Although the initial estimates indicated a requirement of Rs. 60,000 crore for the program, the present indications are that about Rs.1,30,000 crore will be needed for achieving the intended connectivity.
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As per the Budget announcements of 2003-04, the diesel cess which is the source for funding the programme, was increased from Re. 1 per litre to Rs. 1.50 per litre, in order to provide additional funds for the programme. Since the inception of the program, project proposals for Rs. 14,417 crore have been cleared and 88,685 Kms. of rural roads have been taken up under this program. 20,740 road works had been completed till March 2004, and an expenditure of over Rs. 6,547 crore has been incurred by the States/UTs.
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The National Rural Roads Development Agency (NRRDA), registered under the Societies Registration Act, provides Operations and Management support for the program. The Asian Development Bank (ADB) has agreed to support the development of rural roads in Madhya Pradesh and Chhattisgarh, which have been identified as recipient States for the first tranche. The ADB Board has approved a loan of $400 million (in a project size of $571 million). The States of Assam, Orissa and West Bengal have been identified for the second tranche of ADB assistance, of the order of US $500million.
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A first tranche of $400 million for funding projects in Himachal Pradesh, Jharkhand, Rajasthan and Uttar Pradesh is likely to be available from the World Bank by the end of 2004-05.
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