NHAI maintains status quo on termination of highways contracts

Maintaining "status quo" on its decision to scrap 20 contracts, the NHAI today decided to consult all stakeholders, including highway developers body NHBF and the road transport ministry.
The development comes barely days after Road Transport and Highways Minister Nitin Gadkari said he would chair a meeting of highway developers and officials from the NHAI and the road ministry to look into issues facing the sector.
"NHAI executive committee convened a meeting today, headed by Authority Chairman Deepak Kumar, to look into the issues pertaining to termination of highway contracts. However, it was decided to talk to the National Highways Builders Federation (NHBF) on the issue. NHBF representatives will be called in the next executive committee meeting," a top NHAI official told PTI.

The NHAI last week had uploaded a list on its website, which it withdrew later, containing details of 20 projects terminated by the regulator after April 2014 due to contractor's event of default in which developers were asked to make any representation to NHAI headquarters by November 6.
The official said it has been decided that a "status quo" would be maintained on the issue and a consultation would be held with all stakeholders including the Ministry of Road Transport and Highways, NHIDCL and state public works department (PWDs) "given the wider ramifications of the issue".
Taking a strong exception to NHAI uploading the names of companies in public domain, NHBF has said that none of the companies, who have been debarred for the next 2-3 years, were issued any kind of show-cause notice or given an opportunity to represent, before they were put to shame in public

The highway builders' body in its letter to Gadkari and Principal Secretary to PM Nripendra Mishra has said, "Even assuming that NHAI falls under the definition of a state instrumentality and thereby it has, powers to blacklist an entity flows from the executive power to Carry out the trade/business, it has no authority to upload such document in public domain."

The list, which the NHAI withdrew later, had details of 20 projects terminated by the regulator after April 2014 due to contractor's event of default in which developers were asked to make any representation to NHAI headquarters by November 6.

The NHAI has uploaded on its website names of companies including Larsen & Toubro, HCC and Essel Infra Projects and the period for which they were barred from bidding for projects.
The letter had mentioned, "This unilateral action of NHAI has totally shaken the confidence of the developers/ contractors community, especially when the Ministry of Road Transport and Highways is coming out with ambitious development of national and state highways including the Bharatmala scheme."
When contacted, infrastructure major L&T has said termination cannot be treated as its default.