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Highway authority projects hit road block in Kerala, Goa, Bengal

States go slow in acquiring land even as NHAI increases pace of awarding projects

Mihir Mishra  |  New Delhi 

The National Highways Authority of India (NHAI) might have increased the pace of project award, but land acquisition problems in West Bengal, Kerala and Goa might hamper actual road construction.

According to data compiled by NHAI, for the 286 projects under implementation at various stages (including in the award stage), the highways authority has acquired 71.46 per cent of land.

“The problem in Kerala and Goa concerns the people living near the highways. In both the states, we had to decrease the width of the two-lane highways with paved shoulders from 60 metres to 45 metres due to protests,” said a senior NHAI official requesting anonymity.

In the case of West Bengal, the state government, which is supposed to acquire the land, is going slow on it. According to the official, six projects in West Bengal, four in Kerala and three in Goa are stuck because of land acquisition problems. “Overall though, we have acquired land for various projects that are still under award stage,” the official said.

The new model concession agreement (MCA) requires NHAI to acquire and hand over 80 per cent of the total land required for the project to the concessionaire on or before the financial closure of the project. In case NHAI is not able to fulfil this conditions, it has to compensate the concessionaire.

“There is a time gap of six to eight months between award and financial closure of a project, and we have been able to meet the target. The problem areas are the three states,” said the official.

To achieve the target of roads construction at a pace of 20 km a day, NHAI has to award over 7,000 km length of projects every year. In the last financial year, NHAI awarded projects covering 4,200 km and planned to increase it to projects covering 7,800 km.

Of the 7,800 km of projects, the highways authority will be able to award 6,200 km but could not award 1,600 km of projects because of delays in approval from the Public-Private Partnership Appraisal Committee, an inter-ministerial committee that approves infrastructure project.

However, industry feels the problem with land acquisition will continue till the time a Central law is in place. “Land acquisition will remain a problem till the time we do not have a central law because one state or the other may not always be forthcoming. There have been instances where successful developers, with support from NHAI, have worked for land acquisition,” said M Murali, secretary general, National Highway Builders Federation.

The builder’s federation had last year represented to the government that in cases where NHAI fails to provide 80 per cent of the right of way on appointed date, the damages payable by authority on account of delay in handing over of site should mirror the damages payable by concessionaire if commercial operation date (CoD) is not achieved on the scheduled date.

Damages payable by a concessionaire is 0.1 per cent of the performance security for every day’s delay, until CoD is achieved, where as damages payable by the authority for delay in land acquisition is 0.1 per cent of the performance security for every day’s delay until the handover of 80 per cent of land subject to a maximum of 20 per cent of the performance security.

A sum of Rs 50 a day for every 1,000 square meters for the remaining 20 per cent of land required from the 91st day of appointed date.

"To make the agreement equitable to both the parties, we request the authority to pay, at least, damages of 0.1 per cent of the performance security for each day’s delay, without any cap on the damages payable until the entire RoW is procured," the federation had said in their representation.

Acquiring land is a state subject and has always been a problem in implementation of road projects. The land acquisition process takes 24 months, and the road transport ministry is working to bring it down by half.

NHAI has also set up special land acquisition units all over the country under the state government officials on deputation to the authority to expedite the process.

These units are headed by an additional district magistrate or sub-divisional magistrate who reports to the NHAI through project directors (who are NHAI officials appointed to look after the development of the project).

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First Published: Sun, March 11 2012. 00:26 IST