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The National Highways Authority of India (NHAI) has blamed the previous UPA government and its various ministries for the tardy progress in the completion of national highway projects. In a white paper submitted to the ministry of road transport and highways, NHAI pointed out that undue importance was given to award highway projects without considering the project preparedness.

“Pressure was brought to bear on NHAI to award projects even when the land was not acquired to the required extent, environment and forest clearance were not in place, other clearances were under process. Awards became a numbers game,” it said. As part of the corrective measures to revive the road sector, NHAI has requested that unnecessary government intervention should be curtailed and NHAI should be given functional autonomy to achieve the set targets.

NHAI highlighted that the different departments under the ministry of finance often took contradictory stances. For instance, under the model concession agreement (MCA) approved by the department of economic affairs, only 80 per cent of the land required for executing highway projects had to be shown to avail bank finance. However, the department of financial services (DoFS) directed all state owned banks not to lend to road projects unless 100 per cent land is made available.

“Even though DoFS changed their stand later, the delay killed the viability of many projects and many among these had to be foreclosed or terminated by NHAI,” it said. NHAI also stressed the need for more flexibility in the MCA so that it can be amended on mutually agreed basis. “The process for making changes in MCA is very lengthy and cumbersome. As per the current system, any change in the MCA will have to be referred to the ministry, who would circulate the requirement to the members of the inter — ministerial group (IMG).

If even one member of the IMG disagrees with the change proposed, the matter has to be placed before the cabinet for a decision. This process makes it extremely time consuming and virtually inoperable,” NHAI said. The NHAI also criticised the way developers went about aggressively bidding to bag big-ticket projects. Anticipating high levels of revenue growth, NHAI pointed out that many developers had undertaken future obligations, which created over leveraging of their balance sheets.

Source-On Request