Published On : Tue, Dec 20th, 2016

Gadkari admits highway construction lagging far behind targets

nagpur highway
When this NDA government took charge 2.5 years ago, one of the big ticket targets was fast development of
infrastructure, specially Highways.

At different times, Union Road and Highways Minister of Transport, Nitin Gadkari has made claims of constructing between 25 to 40 Kms of roads per day. Highways, not just any roads. Prime Minister Modi, gave a more conservative estimate which still put road construction at 20 Kms per day.

Work did begin at a fast pace in the first pre – monsoon months of this year.

Trees coming in the way were pulled down in thousands despite red signal from the Green Tribunal and environmentalists crying hoarse.

But then the pace slowed…

And the truth is therefore somewhat of an anti climax – according to latest estimates actually achieved figure is close to just 6 kms per day.

Finally, even Nitin Gadkari had to officially aknowledge that the target had been lowered. Speaking to reporters in New Delhi, Gadkari conceded that his ministry will fall short of building 40 kilometres of new roads each day.

Anamoly in figures of awarding new contracts too
But Gadkari still maintained the National Highways Authority of India’s FY17 target of awarding new road projects to build 15,000 kilometres even though the road authority’s own data draws a very different picture.

The NHAI has awarded contracts to build only 2,360 kilometres in the first seven months of this financial year, that’s 16 percent of the target. According to a senior official in NHAI’s planning and statistics department, a total of 2,597 kilometres have been awarded between April and November this year, indicating that another 237 kilometres were added in November, .
The total cost of these projects stands at Rs 31,265 crore.

As against the target of 8000 Kms, only 1417 has been built – that is just 15%.

What has been the problem or bottle neck to meeting targets?
In two words – land acquisition. Or rather the failure thereof.

That was the first big challenge taken up by the Modi government after coming to power in 2014. They proposed some new, rather authoritarian norms for acquiring land farm land from agriculturists claiming they were offering best deals ever to them.

The opposition fought the new laws vociferously and did not let the Act pass in Rajya Sabha. Even the public perception nation wide was against it, with farm leaders also fighting it tooth and nail.

Many Ministers of Modi, including Gadkari himself undertook whirlwind meeting tours across the length and breadth of the country ‘educating’ intelligentsia about the benefits of their Act. They obviously did not succeed.

Experts agree land acquisition continues to be one of the biggest hurdles for new road projects.
“NHAI’s performance is slower than expectation of its own target itself due to regulatory hurdles and delays in land acquisition,” said Teena Virmani, vice president of research at Kotak Securities speaking to Bloomberg “It has to acquire 80 percent of the land before awarding the project ” she added.

Acquiring land problem in Maharashtra too
Land acquisition has been a hurdle in acquiring land in Maharashtra also for the ambitious project of the Nagpur – Mumbai super highway which the CM himself is hopeful of starting in March – April of the coming year and completing within a fixed time period. The fact is that less than 25% land has been acquired for this and the project has already been hit by controversies with senior bureaucrats of the state embroiled in grabbing land in the name of their relatives.

Demonetization may slow down process further
One of the sectors that was hit hard after November 8th was toll collection at highways – which was restricted for some days.

This would obviously lead to fall of revenue for Contractors in road construction, who also collect toll to meet their expenses and in fact, make money. They would obviously lose interest in taking on new projects. Getting labour for construction work could also be a big issue since most migrant labour has gone back to their home states.

The scenario right now for development pace increasing does not seem very rosy for 2017.