Highway contracts hit a rough patch in first half of FY17

Official says, the shortfall is because the government was not ready with the detailed project reports

The National Highways Authority of India (NHAI) awarded fewer contracts in the first six months of the current financial year, compared to the same period last year. Not only was the number of projects less this year, the total length (km) of these projects was also down 16 per cent.  According to an official, the shortfall is because the government was not ready with the detailed project reports. Besides, land was to be made available on priority.

Thirty-six highway contracts, totalling a length of 2,549 km, had been awarded in the April-September period of 2015-16. According to NHAI data, 29 projects of 2,130 km, estimated at Rs 26,000 crore, were awarded in the first  half of FY17.  Half of the total contracts awarded this year were on hybrid annuity model, where the government would bear 40 per cent of the total highway cost.

As many as 11 projects were awarded on engineering, procurement and construction basis. One such project in Rajasthan, totalling a length of 104 km and valued at Rs 1,249 crore, was bagged by Larsen & Toubro.

Road Transport Minister Nitin Gadkari recently announced Rs 2 lakh crore worth of highway projects in the poll-bound states of Punjab and Uttar Pradesh (UP). According to official data, though, only three projects in Punjab have made it to the list of 29 contracts awarded since April, while UP bagged only one project.

Three projects — Ladhowal Bypass, Rupnagar-Phagwara, Kharar-Ludhiana — were bagged by Eagel Infra, GR Infra and Ashoka Concessions, respectively. The total cost of these three hybrid annuity projects is Rs 3,333.34 crore.

The Lucknow-Sultanpur highway project would be executed by Dilip Buildcon; the estimated cost of which is Rs 1,471 crore. It would also be built on the hybrid annuity model.

The travel time from New Delhi to Amritsar is likely to come down by two-and-a-half hours, as an expressway has been planned between these two cities, stretching all the way to Katra in Jammu & Kashmir (J&K). The aim is to cater to the pilgrims visiting the holy city in Punjab and Vaishno Devi shrine in J&K.

In Uttar Pradesh, the ministry announced road projects worth Rs 2 lakh crore. An expressway connecting Kanpur and Lucknow has also been envisaged. It would come up at a cost of Rs 1,500 crore and would reduce the current travel time between the two cities to 35 minutes, from an hour.

In April-September 2016, Gujarat and Rajasthan bagged seven and eight contracts, respectively.

While five highways would be built on hybrid annuity model in Rajasthan, two are toll projects.

Barring the Kamrej-Chalthan highway in Gujarat, the remaining six projects would come up on hybrid annuity model.