India is one of the fastest growing economies in the world and role of infrastructure is very important in overall development of the country, from past two decades demand of vehicle and growth of automobile sector resulting more vehicle on road, traffic chaos and increasing pollution, to cater growing vehicle population now we need more roads, flyovers, expressway, underpasses and tunnels.
We have witnessed major announcements of programmes and schemes in modi government; we can highlight some of them like, Bharatmala pariyojna, green highway mission, Chardham connectivity scheme, Technological advancement under Intelligent Transportation System, Highway Village and Highway Nest etc. Within the NH bracket, 32 per cent of road length is less than two lanes wide. This effectively means that one-third of national highways are not conducive to speedy and sustainable movement of commercial and passenger traffic, it also indicates that much work is left to be done in order to optimise these roads, to make the whole network ready for heavy traffic loads. A mere 22 per cent of existing national highways were four lane as of 2015. The goal is to convert all 2 lane highways into 4-6 lane highways.
Roads Target and Construction for Last Five Year
Award Status (Length km)
|
Year
|
MoRTH
|
NHAI
|
NHIDCL
|
Total
|
2013-14
|
1,894
|
1,726
|
-
|
3,620
|
2014-15
|
4,905
|
3,067
|
-
|
7,972
|
2015-16
|
5,464
|
4,344
|
290
|
10,098
|
2016-17
|
10,512
|
4,336
|
1,100
|
15,948
|
2017-18
|
8652
|
7397
|
1006
|
17055
|
Construction Status (Length km)
|
Year
|
MoRTH
|
NHAI
|
NHIDCL
|
Total
|
2013-14
|
2,499
|
1,901
|
-
|
4,400
|
2014-15
|
3,008
|
1,502
|
-
|
4,510
|
2015-16
|
4,078.50
|
1,988
|
-
|
6,066.50
|
2016-17
|
5,608
|
2,628
|
65
|
8,301
|
2017-18
|
6167
|
3071
|
591
|
9829
|
Strong FY18, momentum expected to continue: MoRTH ordering was up 7% YoY to 17,055km in 2017-18. However, with a jump of 70% YoY NHAI witness quantum jump in ordering in FY18 and ordered 7,397km worth Rs1.22tn in FY18 against 4,335km in FY17. Length of 3,791km was awarded on EPC mode, 3,396km was awarded on HAM and 209km on Toll mode out of the total projects awarded.
HAM projects – financial closure happening: Financials closure of HAM projects are happening and private banks and select NBFC’s are taking the lead. Select PSU, led by SBI have started to lend to road sector (HAM projects)
Proposed Funding Plan
Source (INR bn)
|
Bharatmala - I
|
Other Schemes
|
Total
|
Central Road Fund earmarked for NH
|
1397
|
974
|
2370
|
GBS –SARDP-NE, EAP, Counterpart Funds, etc
|
-
|
600
|
600
|
Expected monetization of NH
|
340
|
-
|
340
|
PBF –Toll Collections of NHAI
|
460
|
-
|
460
|
Market Borrowings
|
2093
|
-
|
2093
|
Private Investment (PPP)
|
1060
|
-
|
1060
|
Total
|
5350
|
1573
|
6923
|
The funds accrued under the Central Road Fund (CRF) as per the provisions of the CRF Act, 2000 amended by the Finance Act from time to time during 2015-16, 2016-17 and 2017-18 were Rs. 69,809 crore, Rs. 80,800 crore and Rs. 85,600 crore (Provisional) respectively.
Smoother approval and clearances: No project is delayed at present due to late submission of Ecological Impact Assessments (EIA). Environmental Impact Assessment (EIA) is a part of the project preparation. The process of EIA starts with the feasibility studies and culminated with preparation of Detailed Project Report (DPR). In order to avoid unnecessary delays in environment related clearances, the persistent pursuance is done with the Ministry of Environment and Forest & Climate Change (MoEF&CC). The process of environment clearances has been streamlined by MoEF&CC by taking important decisions as given below:
- Process of environment clearance and forest clearance was delinked by MoEF&CC facilitating parallel processing of clearance proposals.
- The requirement of specific Term of References for highway widening projects has already been dispensed with.
- The threshold for triggering the requirement of environment clearance has been relaxed up to the limit of 100 km length. In addition, above this length, projects requiring additional land acquisition up to 40 m for widening and up to 60 m on the realignments are also exempted
- MOEF&CC has delegated the powers for linear projects to Regional Empowered Committees (RECs).
Way forward
Total 1,837 numbers of projects amounting to Rs. 6,45,199 Crore having length 61,164 km are ongoing for the development & resolving the problem of traffic jams on National Highways in the whole country. Also for safety of commuters, provisions of over bridges/Underpasses, widening of roads on war footing highway development projects are made as an integral part. A total of 28 nos. ring roads, 125 nos. choke points and 66 nos. congestion points have been identified in the entire country under the Bharatmala Pariyojana Phase-I. In addition to the ring roads, the interventions such as bypasses, lane expansion, flyovers, ROBs, service roads etc. have been envisaged to be developed for decongesting the aforesaid choke/congestion points.
Ministry has set the overall target of 15000 km for awarding of work & 10000 km for construction of National Highways in the current financial year 2018-19. They have constructed/developed 2345 km of NHs as on 30th June in 2018-19. The funds allocated is Rs.1,16,670 Crore including IEBR (Internal and Extra Budgetary Resources) for the construction/development of NHs in 2018-19 .Detailed study of the freight movement between all districts have been conducted along with geo- informatics inputs. Thereafter, development of 44 nos. new economic corridors has been planned under Bharatmala Pariyojana Phase-I, to complement the existing National corridors. In addition to this, development of bypasses, ring roads, grade separators etc. has also been envisaged under Bharatmala Pariyojana Phase-I to de-congest choke/ congestion points on the existing corridors.
Good times ahead for road companies
Robust award has led to significant improvement in order books of road companies. Book-to bill for most players is amongst the highest over the past few years. With project award expected to remain strong in FY19, we believe the road sector will continue to attract significant investments going ahead, benefiting road-focused companies