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NHAI to award highway projects worth Rs 72,000 cr in Q4FY21

The fourth quarter highway project pipeline of the ministry will give a major push to awarding of the projects in current financial year, which have been deeply impacted by the Covid-19 pandemic

Ashutosh Kumar | February 17, 2021 | Updated 12:22 IST
NHAI to award highway projects worth Rs 72,000 cr in Q4FY21
While some of the bids have already been opened, the NHAI will open the remaining bids soon and will award all the projects thereafter

The union transport ministry has lined up bids for national highways worth about Rs 72,000 crore spanning about 2,600 km to be awarded by the end of this quarter. The fourth quarter highway project pipeline of the ministry will give a major push to awarding of the projects in current financial year, which have been deeply impacted by the Covid-19 pandemic.  

A ministry official told BusinessToday.In on condition of anonymity that bids for over 77 projects are in the various stages of tendering. While some of the bids have already been opened, the NHAI will open the remaining bids soon and will award all the projects thereafter.  

"The total capital cost of these projects is Rs 71,891 crore and they will be awarded in the current quarter. More projects may even be taken up for awarding," the official added.  

A majority of the projects will be taken up on the hybrid annuity model (HAM), while others will be taken up on engineering procurement and construction (EPC) contract basis. Two projects will be taken on build operate and transfer, BoT (Toll) - the public-private partnership model that has been lying defunct for close to a decade now.  

According to data from Yes Securities, 55 percent of the highway projects in the tendering pipeline currently will be awarded on HAM basis, 35 percent will be awarded on EPC mode. HAM and EPC are the construction model in which traffic risk and capital cost are borne by the government.  

While in the BoT (Toll), the private sector participant arranges funding for the project, builds and operates the project, and transfers the asset to the government after the end of the concession period.  

The BoT toll projects are six-laning of national corridor on the National Highway - 19 from Palsit to Dankuni in West Bengal spanning 64 km at a capital cost of Rs 2,193 crore, and six-laning of Panagarh to Palsit costing Rs 2,021 km and connecting 67.8 km.  

According to data from the National Highways Authority of India (NHAI), the current financial year's highway award may outpace the two preceding financial years. A total of 1,330 kms of highway projects were awarded in the first half of FY21.  

However, the pace gathered in the second half, and construction contracts of 7,696 km of highway have been awarded to date creating a pipeline for future construction. This is more than double the 3,509 km of highway contracts awarded in FY20.  

Also read: PM Modi talks to stakeholders to expedite infra creation

Also read: Land, transport subsidy and more! Tamil Nadu goes all out to get foreign investment

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