Labour, raw material shortages big hurdle for infra projects
Infra major NCC says it will be a big challenge to continue operations in first two quarters of current fiscal
Hyderabad: Even though the central government has given its nod for the commencement of operations at infrastructure and construction projects to ease impact of Covid-19 lockdown and reboot economy, labour and raw material shortages seem to have become a big hurdle for infrastructure companies in putting their operations back on full track.
For instance, NCC Limited, a city-based infrastructure major, is able to carry out only 40-50 per cent of operations at many of its projects owing to labour and raw material shortages. "We have around 180 ongoing projects across the country. Works have been restarted at many projects. But only 40 to 50 per cent of normal level of work is going on as there is manpower shortage.
Construction material is also in short supply as all the highways are closed and transportation of materials like cement is a problem," YD Murthy, Executive Vice President (Finance), NCC Ltd, told The Hans India. The infrastructure major employs 50,000 to 60,000 people at its project sites in India. Of them, 6,000 are on the company's rolls while the remaining are piece rate workers. "Only 25,000 people are currently working now. Labour and construction material shortage is the biggest hurdle for the projects," he said.
Murthy expects that it will take some time for the operations to stabilise. "Labour is the critical component for executing projects. Most of the manpower is in relief camps. After the lockdown is lifted, they will go to their villages and spend some time with families before coming back. This process may take one to two months by which time monsoon will arrive. We can't carry on construction during monsoon. So first two quarters of this financial year look like a washout," he explained.
But NCC looks to fare better in the second half of the current financial year. "To kick-start the economy, governments will have to take up more infrastructure projects. That will benefit us in long run," he said. Murthy however said that company's top line and bottom line will take a hit this financial year. "It will be very difficult to match last financial year's revenues and bottom line," he said.