National highway builders urge NHAI to address project hurdles

The National Highways Builders Federation (NHBF) has highlighted critical challenges faced by infrastructure companies involved in road projects managed by the National Highways Authority of India (NHAI), sources have told Business Today TV. 

The focus was on issues within the Hybrid Annuity Model (HAM) and Engineering, Procurement, and Construction (EPC) contracts, which are crucial for India's highway infrastructure development.

While the NHBF acknowledged recent improvements by NHAI aimed at enhancing transparency, efficiency, and fairness in project execution, it emphasised that several key challenges remain unaddressed. "These unresolved issues, according to the Federation, continue to cause delays and increase financial burdens on concessionaires, threatening the timely completion of projects" the source added.

The recent shift in NHAI’s working dynamics, particularly the referral of routine contractual issues to a Sole Conciliator, has been identified as detrimental. Concessionaires are being pressured to surrender legitimate claims in exchange for approvals, which undermines confidence and hampers the ease of doing business.

A major concern raised was NHAI's practice of inviting bids without securing necessary approvals beforehand. This often leads to pre-bid uncertainties, resulting in delays and additional burdens on concessionaires. The NHBF stressed the importance of having all approvals in place before bidding begins to reduce risks and streamline project execution.

Post-agreement challenges were also highlighted, particularly the burden on concessionaires to secure clearances and land acquisitions—tasks that should be managed by NHAI. The NHBF called for NHAI to take a more proactive role in these areas to reduce operational strain and prevent further delays.

Financial strain due to delays was another key issue discussed. Concessionaires often face ongoing financial commitments because of NHAI's inaction, even before projects commence. The NHBF urged NHAI to act promptly to prevent such delays and mitigate their financial impact.

Additionally, the demand for additional work at rates not covered in the original contract, and the exploitation of ambiguous contract scopes, were seen as further strains on concessionaires' resources.

Delays in issuing No Objection Certificates (NOCs) and Completion Certificates (CCs) were also highlighted, with the NHBF urging NHAI to streamline these processes to prevent financial losses for concessionaires.