NHAI fo­cus on pro­jects with clear­ances

Business Standard - - FRONT PAGE - MEGHA MANCHANDA

Tight­en­ing its fist on project fi­nanc­ing, the road min­istry, which aims to con­struct 30 per cent more roads each day this year, will fo­cus on ex­e­cut­ing con­tracts where all req­ui­site clear­ances are in place. Now, its con­struc­tion wing — the Na­tional High­ways Author­ity of In­dia (NHAI) — is ju­di­ciously plan­ning its ex­pen­di­ture for the cur­rent fi­nan­cial year.

The length of high­ways com­pleted by the Min­istry of Road Trans­port and High­ways, the NHAI, and the Na­tional High­ways & In­fra­struc­ture De­vel­op­ment Cor­po­ra­tion Ltd (NHIDCL) in 2017-18 was 9,829 km, or roughly 27 km a day.

“This year we would con­struct 15,000 km, or 30 per cent more roads a day than what we did last year,” a se­nior official said.

Union Road Min­is­ter Nitin Gad­kari had said the daily day road con­struc­tion tar­get for 2018-19 was 45 km. How­ever, the in­ter­nal tar­get of the min­istry is about 35 km a day by the end of this year, an official said, re­quest­ing anonymity.

The move is aimed at ju­di­ciously plan­ning the ex­pen­di­ture by the cen­tral govern­ment, the NHAI, and NHIDCL. “Since the NHAI has to bor­row money, we only want to in­vest in the pro­jects that will give re­turns. We will also fo­cus on com­plet­ing the pend­ing pro­jects,” an NHAI official said.

The NHAI's bor­row­ings dur­ing the cur­rent year are ~620 bil­lion. In Au­gust, the author­ity tied up loan worth ~250 bil­lion with State Bank of In­dia.

Ex­perts be­lieve that this is a step in the right di­rec­tion as project im­ple­men­ta­tion is faster once the nec­es­sary clear­ances are in place. “The ap­proach would en­sure that the fi­nan­cial costs in­curred can de­rive eco­nomic ben­e­fits in the short­est time pos­si­ble,” said Kushal Ku­mar Singh, part­ner, Deloitte Touche Tohmatsu In­dia LLP.

Cit­ing an ex­am­ple, Singh said the Jaipur-Kishen­garh six-lane project was ex­e­cuted in 24 months be­cause the land acquisition for the con­tract was in place.

Even as there is nearly a 30 per cent in­crease in the per day per kilo­me­tre of road con­struc­tion tar­get for the fiscal, in terms of lane kilo­me­ters, the tar­get re­mains 94 km lane per day by the end of this year. A lane-km is de­fined as a kilo­me­tre-long seg­ment of a road that is a sin­gle lane in width. For ex­am­ple, a 1-km stretch of a stan­dard two-lane road rep­re­sents two lane-kilo­me­tre).

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