Anurag Jain, Secretary at the Ministry of Road Transport and Highways, revealed that the government of India plans to issue tenders for 10,000 kilometres (km) of road projects by March 2024.
That's a significant increase in the pace of new contracts for roads and highways. “In the first 9 months, the actual award(s) came down to between 3,000-3,500 km. But in the next one-and-a-half months, we expect the model code to kick in in the first week of March, this 3,500-kilometre number will go to 10,000 km,” Jain told CNBC-TV18 in an exclusive interview, just weeks before the government's annual budget presentation on February 1.
The ministry led by Nitin Gadkari construction of 5,248km of national highways between April and November 2023. That's 10% more than the 4,766 km during the same period last year.
More tenders before the Lok Sabha election
The pressure to step up efforts is also higher on the government months before the elections for the Lok Sabha, the lower house of Indian Parliament, scheduled in the summer of 2024.
Prime Minister Narendra Modi has pitched the government's efforts on infrastructure development as one of its achievements before he seeks a third term in office.
The upcoming road projects will include under the build-operate-transfer (BOT) projects, which are scheduled to be awarded in June after the completion of the model code and associated procedures, Jain added.
The slump in road construction in 2023 may reverse
The government had set a target of building around 12,000 km of roads in the financial year ending March 2024.
However, new tenders slowed down significantly because the government decided that new projects should be awarded only to those who had acquired the land and had the necessary approvals.
So, between April and November 2023, new contracts awarded amounted to 2,815 km compared to 5,382 km in the same period a year earlier.
Another massive highway project, Bharatmala Phase I, hit a hurdle in recent months. After severe delays and cost overruns, the ministry had to return to the Union Cabinet for approvals for new projects.
The first phase (34,800 km) of the Bharatmala project was supposed to be complete in 2022, six years after its initiation in 2017.
However, in December 2023, the deadline was extended to 2028. By the time the extension was allowed, the estimated cost for the project had more than doubled from the initial Rs 5.35 lakh crore (for the first phase alone).
The construction sector has been one of the fastest-growing segments within the Indian economy.
(Edited by : Sriram Iyer)
First Published: Jan 18, 2024 12:56 PM IST
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