The Union government has extended the deadline for completion of its flagship highway development project Bharatmala Phase-I to 2027-28, six years from the original schedule, the Ministry of Road Transport and Highways (MoRTH) said in its annual report.
The ministry, in the annual report 2023-24, said a revised financial proposal to construct 34,800 km of national highways in 31 states and UTs and more than 550 districts for the Bharatmala Pariyojana is under process for approval.
The approval and bidding of national highways under the flagship Bharatmala programme recorded a shortfall of 34 percent in 2023-24, as the revised cost of the scheme was pending approval from the Cabinet. The move follows an over 100 percent increase in the estimate cost of the mega project to nearly Rs 11 trillion, and reflects the slowing of implementation, and financial constraints.
“Major shortfall was because of Bharatmala where the revised approval of the Cabinet could not be obtained,” the ministry said in its annual performance report.
Highway construction in FY24 stood at 12,349 km, with an average construction of 34 km per day. The highest highway construction of 13,327 km was done in FY21, which included strengthening of 4,900 km.
The escalated cost of Bharatmala has been a cause of concern, and the Union Finance Ministry told MoRTH in 2023 not to award any new project under the scheme till there is Cabinet approval on the revised cost of the project.
"The length awarded is 26,425 km, and the length constructed is 17,411 km so far. The programme is expected to be completed by 2027-28," the report said.
The slack in pace of awards and construction activity has also raised obvious concerns relating to timely completion of BMP and cost overruns for developers, investors and government.
In August last year, the Comptroller and Auditor General (CAG) of India found instances of irregularities in the awarding of projects by agencies implementing central government-funded highway projects.
In its report on the implementation of Phase-I of Bharatmala Pariyojana, the auditor has also found deficiencies in the appraisal and approval mechanism proposed to the Cabinet Committee on Economic Affairs (CCEA) and also flagged huge cost overruns in many of the high-cost Engineering Procurement and Construction (EPC) projects, including the construction of the Dwarka Expressway project and Delhi-Vadodara Expressway.
However, MoRTH had responded the the CAG's report saying that is a gross misrepresentation of facts.
MoRTH said the average cost of special projects enveloping substantial lengths of bridges/via-ducts/tunnels under Phase-I of the Bharatmala Pariyojna stands at around Rs 152 crore per km.
Union Minister of Road Transport and Highways Nitin Gadkari had also refuted allegations of "cost overruns" in the construction of the Dwarka Expressway and said that the project did see any cost overrun or any instance of corruption.
After the completion of the Bharatmala Pariyojana Phase-I by 2028-29, the MoRTH is expects to collect Rs 1.25 lakh crore from user fee and monetisation of national highways – three times more than it was in 2022-23.
In 2017, the Union Cabinet approved 34,800 km of national highway for development under Phase-I of Bharatmala Pariyojana. As of December 2023, 26,418 km (76 percent of 34,800 km) have been awarded for construction with the completion of about 15,549 km. The projects under Bharatmala are mainly funded by the Union government and resource mobilisation is done by the ministry.
Further, about 8,000 km of interstate corridors and about 7,500 km of feeder routes have been identified for improving the effectiveness of Economic Corridors, GQ and NS-EW Corridors. The Bharatmala (approved for an estimated cost of Rs 6,92,324 crore, including other ongoing schemes) is to be funded from Central Road and Infrastructure Fund cess (Rs 2,37,024 crore) collected from petrol and diesel, remittances (Rs 46,048 crore), apart from additional budgetary support (Rs 59,973 crore), expected monetisation of national highways (through Toll-Operate-Transfer model) (Rs 34,000 crore), Internal and Extra Budgetary Resources (IEBR) (Rs 2,09,279 crore) and private sector investment (Rs 1,06,000 crore).
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