Moneycontrol
Nov 17, 2017 05:20 PM IST | Source: Moneycontrol.com

Bharatmala moves to high speed zone; NHAI set to give project approvals in 15 days under new rules

The new guidelines allow NHAI to approve projects worth up to Rs 2,000 crore, a 100 percent jump over the earlier threshold

Nikita Vashisht @nikita_vashisht

The government's flagship roads programme, Bharatmala Pariyojana (BMP), is expected to see three times speedier implementation of projects as the guidelines allow “great degree of power”  to National Highways Authority of India (NHAI).

“There has been a lot of delegation of power under BMP,” Deepak Kumar, chairman, NHAI told Moneycontrol.

He said that it was a “huge delegation of power” by the union ministry for road transport and highways (MoRTH) to allow NHAI to take decisions with respect to projects being developed under Engineering-Procurement-Construction (EPC) and Build-Operate-Transfer (Toll).

“All Public Private Partnership BOT (Toll) projects, irrespective of size and cost, where no grant (or Viable Gap Funding) is given to the concessionaire and the construction and maintenance is financed by toll revenues are to be appraised and approved by NHAI Board,” read the ministry’s official statement.

Under the guidelines of BMP, NHAI has been delegated to appraise and approve the projects being developed under EPC and BOT (Toll) up to Rs 2,000 crore which does not require viability gap funding (VGF). This is a 100 percent jump from the previous Rs 1,000 crore threshold, originally given to NHAI.

Also read: NHAI revises highway project award target to 10,000 km for FY18

“The NHAI Board is on its own (now)... It can take decisions for any project at any level under EPC,” said Kumar adding, “It’s the same in BOT (Toll), except that projects beyond worth Rs 2000 crore have to follow another procedure... So, this is a huge delegation”.

Explaining the entire procedure, Kumar said that until now a project under EPC was first appraised by NHAI board, which was then sent to the cost committee of roads ministry for approval. It was later sent to Department of Expenditure under Finance ministry.

“Before this delegation, a project approval had to go through a long process… At every step, a note had to be circulated among members, including NITI Aayog, Finance Ministry, etc which would receive comments from everybody,” he said.

He said that at every level, a gap of “minimum 15 days was witnessed” while the total time taken would cross 45-60 days.

“Now this all will be done within 15 days,” he said.

Also read: First phase of Bharatmala Pariyojana to start by end of 2018: Gadkari

Centre’s ambitious Rs 6.92 lakh crore roads programme received the cabinet’s nod last week, which envisions to create a road network of over 60,000 kilometers. The project subsumes all the previous road programs, including National Highways Development Project (NHDP), and has an estimated capital outlay of Rs 5.35 lakh crore under Phase-I.

Over the next five years, India will see approximately 35,000 km of road network being built including 9,000 km of economic corridors, 6,000 km of feeder roads, 2,000 km of border roads and 800 km of Expressways. Construction under Phase-I will also include 10,000 km of remaining work under NHDP.

“All the projects under Bharatmala would be technically, financially and economically appraised by an empowered project appraisal and technical scrutiny committee under the NHAI and Ministry,” Nitin Gadkari, union minister for road, transport and highways had said at the press briefing after the approval.

Projects under BMP have to be approved by “expanded” NHAI Board which will include CEO, NITI Aayog, Secretary (Department of Expenditure), Secretary (MoRTH), Director General (RD) and Special Secretary (MoRTH) as part-time members.

Ministry's official statement said that NHAI will be allowed to delegate its power further within the organisation.

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