'None of 21 NHAI road projects gets response from builders'

Tepid response from highways builders to PPP mode coupled with current market conditions has resulted in focus to EPC route for road building as none of the 21 projects bid under PPP could elicit any response, the government today said.
At present 180 road projects under PPP mode valued at Rs 1.9 lakh crore are under construction through various agencies.
"Twenty-one projects were bid out by National Highways Authority of India (NHAI) through public-private-partnership (PPP) route, but none of the projects has received any response," Minister of State for Road Transport & Highways Krishanpal Gurjar told Rajya Sabha in a written reply.

He said, "due to lack of equity in the market there has been a lukewarm response from the builders for the projects under PPP mode during 2012-13 and 2013-14."
During 2013-14, NHAI had awarded 17 projects for a total length of 1,435.84 km of which two projects are on PPP mode, he said.
Considering the current market conditions, particularly with reference to the highway sector, focus of the government is on implementation of highways through public funded engineering, procurement and construction (EPC) mode, he added.

He said once the highways sector gathers momentum through execution of the EPC projects and current issues plaguing PPP mode are well addressed, the focus on the mode including build, operate and transfer (BOT) toll would be restored.

Unlike PPP model where the private sector has to fund the road building, in the EPC model, the Government funds a highway, with private firms designing and building the road.
In a separate reply, Gurjar said, "At present 180 number of PPP projects under the Ministry are under construction th rough various agencies with total project cost of about Rs 1.9 lakh crore."
Last month Road Transport & Highways Minister Nitin Gadkari has said that PPP model was not feasible at present for award of road projects due to a host of issues "created by the previous government" and that schemes will be bid out on EPC mode.

"Projects were bid out by previous government without even 10 per cent of the required land acquisition. Work could not start on the project where financial closure took place two years back. Banks withdrew financial closure...PPP mode is not possible now. We will work on EPC model for a few years," he had said.