EXPANSION OF NH-9 IN ANDHRA PRADESH

Four-laning of National Highway (NH)-9 in Andhra Pradesh is being taken up in a phased manner. Hyderabad-Machillipatnam section of this NH is being taken up for four-laning by National Highways Authority of India (NHAI) on Build, Operate and Transfer(BOT) basis under National Highway Development Project(NHDP) Phase-III. Four-laning in a length of 31 km from Hyderabad to Sangareddy is in progress on BOT basis. These works are targeted for completion by December, 2011. Consultancy services for examining the viability of 4/6 laning of Sangareddy-Zaheerabad section of this NH on Design, Build, Finance and Operate(DBFO) pattern is under progress. Further action in this regard will depend upon the outcome of the said study. This information was given by the Minister of State for Shipping, Road Transport and Highways, Shri K.H. Muniyappa in a written reply in the Lok Sabha today.  Source: http://pib.nic.in

Plan to upgrade 19 State highways to NHs pending with Centre

Hyderabad, March 18:The proposal to convert 19 State highways into National Highways for a length of 4,832.7 km is pending with the Ministry of State Road Transport and Highways (MoSRTH).“We are waiting for their approval,” Roads and Buildings Minister T Jeevan Reddy informed A Uma Madhava Reddy (TDP) and others during the Question Hour in the Assembly on Monday.The minister said that seven roads for periodical renewal works of the length of 68.84 km at a cost of Rs 16.85 crore have been taken up and completed with the funds provided by MoSRTH. Extensive repair works to the badly damaged National Highways have also been taken up to ensure free flow of traffic.The widening of Hyderabad-Vijayawada section of National Highway-9 was being taken up by National Highways Authority of India on BOT basis and the prequalification bids have been invited, the minister said.To another question by P Rajanna Dora, the minister said that Kottaki bridge across Votti Gadda river in Vizianagaram district was in bad shape and a new bridge would be constructed at a cost of Rs 5 crore.Agriculture Minister N Raghuveera Reddy informed K Ramulu (Janata Party) that Chief Minister Y S Rajasekhara Reddy would write a letter to Prime Minister seeking Padma awards to best farmers. He said that awards to the best farmers would be given at mandal levels by the State Government. Source: http://www.siasat.com 

Annuity model for Bihar, Jharkhand BOT projects

NHAI has not been able to award any project on build-operate-transfer basis via tolling in the states in last two years

New Delhi: Desperate to get the roads programme off the ground in Bihar and Jharkhand, where the private sector is declining all offers—including on lucrative stretches—in view of the challenge from Leftist extremist groups, the Centre is offering investors guaranteed payments instead of recovering their investment by collecting toll revenues.

A senior official of the National Highways Authority of India (NHAI), the regulator for highways, who did not wish to be identified, said, “The reason for this (investor disinterest) is partly law and order situation in these states, and Naxalism.”

As a result, NHAI has not been able to award a single build-operate-transfer (BOT) highway project through tolling in these states in the last two years. In such highway projects, the company awarded the contract for constructing a stretch of highway collects toll from those using the highway.

 

Law and order, and Naxalism scare away bidders, who recover their investment from highway tolls

 

Prime Minister Manmohan Singh recently said that Naxalites, Leftist extremists, posed the single biggest internal security challenge to the country. As many as 13 out of 28 states in the country are classified as Naxalite-affected.

To woo investors towards these highway stretches, NHAI is now planning to recast these BOT projects on an annuity basis, wherein contractors who are awarded projects would be paid a guaranteed amount in instalments.

The authority had carved out around 11 highway sections in Bihar for awarding under the BOT mode in 2006 under phase III of the National Highway Development Programme.

NHAI first put up its most lucrative stretch, Patna–Muzaffarpur, for bidding in early 2006, but it received no response. “We then tried putting up another stretch for bidding as well, but even then the companies did not show any interest,” said the NHAI official.

The authority has faced a similar problem in Jharkhand, where it did not receive any bids for a couple of tolled road projects.

The lack of interest in tolling projects in Bihar and Jharkhand is happening at a time when NHAI has made it a policy to gravitate towards BOT projects in order to reduce the government’s investment in the highway sector.

Another official in NHAI, who also did not wish to be identified, confirmed that the highways regulator now planned to redraft the proposal for these projects under annuity terms.

Members of Parliament from the two states said concerns over viability of the projects apart, private players were hesitant to take up contracts in these areas because they feared for the security of their staff.

Bhubaneswar Prasad Mehta, a Lok Sabha member of the Communist Party of India from Hazaribagh in Jharkhand, said even as some tenders were floated last year, there was little response from the private agencies. “Infrastructure development cannot happen in a vacuum,” he said. “Why should anyone risk his life in an area where there is no rule of law and little security? We are planning to raise this issue yet again in our party’s three-day state conference in Ranchi, which begins on 15 March.”

However, Nikhil Kumar, a former special secretary for internal security in the Union ministry of home affairs, and a Lok Sabha member of the Congress party from Aurangabad in Bihar, said the situation was somewhat better in his constituency.

“I can say for my constituency that though the quality of work remains a matter of concern, wherever we have managed to provide sufficient security to the contractors, with the help of the state government, there has been some progress,” said Kumar. “If the political representatives from these two states, and other areas affected by Naxalism keep pursuing the matter with the state governments and the private executing agencies, we can get the work done. In my constituency alone, about 25 link roads will be constructed under the Pradhan Mantri Gram Sadak Yojana (Prime Minister’s Village Road Programme) and work is set to begin. Earlier, between 2004 and 2007, seven other roads were completed in my constituency,” he added.

Ram Deo Bhandary, a Rajya Sabha member of the Rashtriya Janata Dal from Bihar, said it was quite clear that even a few high-profile incidents of violent crime could deter developmental activities.

“There haven’t been too many incidents of late, but, of course, law and order remains an area of concern. If contractors are not coming forward to take up work, it is quite clear that the state has not been able to instil confidence in them,” Bhandary said. Source: http://www.livemint.com

NHAI likely to issue contracts for 10,000km of highways soon

These contracts will be a part of phase III and phase V of the government’s highway project New Delhi: The United Progressive Alliance government wants to award, in the next few months, contracts to build up to 10,000km of national highways, equal to almost 70% the 14,500km of national highways on which similar contracts have been issued since 2000.Long Road Ahead (Graphic)The decision to award the contracts, worth at least Rs70,000 crore, comes with the general election likely to be held either late this year or early in 2009, although an official at the agency that regulates the highways sector in India claimed that this was because procedural issues related to the contracts had now been “ironed out”.The official at the National Highways Authority of India, or NHAI, added that since 2000, when the country’s National Highways Development Programme or NHDP was launched, the regulator had awarded contracts for the construction of 14,500km of highways worth around Rs80,000 crore and that work on 8,500km had been completed.The contracts that will be issued are part of phase III and phase V of NHDP and involve upgrading existing national highways into four-lane and six-lane ones. Five of the seven phases of NHDP involve upgrading existing highways.The stretches will first be offered to private companies to be developed under the ‘build-operate-transfer’ model where the companies will build the highways, operate them and collect toll for a certain period of time, and transfer them to the government at the end of a certain period of time called the concession period. In case this fails to draw bids, the projects will be offered on the ‘engineering-procurement-construction’ method, where private companies build the roads for a stipulated fee but will not have any stake in the project.“Detailed project reports are being created for these stretches and they are expected to be awarded in the next few months,” said a senior government official, who did not wish to be identified. “There was a lull in award of projects because the policy was being ironed out. But now that things are falling into place, you will see more and more projects on offer,” the official added.For almost a year, NHAI has gone slow in awarding projects.“Till now we were waiting for ironing out procedural issues such as preparation of the new model concession agreement and setting up a two-stage bidding process. Those matters have been taken care of now. And now the only serious impediment in the way of awarding these contracts is clearing of the toll policy,” said an NHAI official.The toll policy is to be cleared by the law ministry and this could take a couple of months, the official added.Analysts however said that while the agency was capable of awarding 8,000km of construction a year, exactly how much would get done depends on a number of factors including a legal challenge to the government’s bid process.The National Highways Builders Federation, an industry body, filed a suit in January against guidelines issued by the finance ministry and ratified by the Prime Minister’s committee on infrastructure that favour bidders who have executed large projects. The norms, reported by Mint on 28 December, cap the number of bidders at six, with some individual exceptions.“There are three factors that could affect the process (of awarding contracts),” said Kuljit Singh, a partner with the transaction advisory services practice of audit and consulting firm Ernst and Young Pvt. Ltd.“Technical detailed project reports usually take a while to prepare. Also, things generally slow down a little in an election year. Also, depending on what the court finds (in the case where the National Highways Builders Federation has challenged NHAI’s bidding norms), the process could be affected,” he added.Source: http://www.livemint.com 

Cartelisation highway leads to Delhi

NEW DELHI: The National Highways Builders Federation, a body representing infrastructure companies, has filed a case in the high court against the ministries of finance and surface transport, and National Highways Authority of India (NHAI), stating the recently-announced selection process for infrastructure project bidders is promoting cartelisation within the industry. According to the federation, only bigger players such as GMR, GVK and Reliance Industrial Infrastructure will benefit from the new policies. Fearing cartelisation, smaller players, including Gammon India and Navyug, had lodged an official complaint with the federation. In December 2007, the government had announced a new selection process for infrastructure project bidders. According to the policy, only six bidders with the maximum experience would be eligible to participate in the financial bid stage. However, the policy does not specify the names of the six bidders. Earlier, NHAI had been developing infrastructure projects under another scheme in public-private partnership projects. So far, NHAI had issued a notice inviting tenders that was divided into two parts: technical bid and financial bid. In the technical bid stage, the credibility of the bidder was examined. Those eligible for this round could bid in the financial round. For this, the bidder would either give a grant to the government or give the minimum concession period — the shortest period under which it would return project to the government. “The policies are tilted towards the big players in the industry, whereby the top six companies will always be successful bidders with their kind of experience,” Hammurabi & Solomon senior partner Manoj Kumar told ET. Under the present policy, bidders that do not make it to the top six would automatically be pushed out of the race. “This is unfair and will lead to cartelisation,” sources said. Source: http://economictimes.indiatimes.com 

Mega six-lane projects in offing

With access-controlled expressways attracting massive investments, the Ministry of Road Transport and Highways has decided to conduct the feasibility study for more such expressways.

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  Construction companies eyeing the access controlled, six-lane expressway projects of National Highways Authority of India (NHAI) are likely to get investment opportunities for at least four such projects spread over 495 km over the next few months.They are Chandikhol-Jagatpur-Bhubaneswar (70 kilometre length, estimated cost Rs 761 crore), Delhi-Hapur (47 km, Rs 474 crore), the 198-km stretch of Vijayawada-Elluru-Rajamundri (Rs 1,602 crore) and the 180-km stretch on Delhi-Agra highway (Rs 1,918 crore). The feasibility reports for these projects are already completed and the work is likely to be awarded in about six months, said NHAI officials.Toll collection  These projects are for widening the current four-lane highways into six lanes and operating them for certain durations.Companies would have to bid competitively for these projects on a revenue-sharing basis. Thus companies would have to bid on the extent of toll revenue that they are ready to share with the Government if they are allowed to operate the roads.Since these highways are already four-lane stretches, the road operators can start toll collection even during the project construction phase from an ‘appointed date’ (within six months of winning the project), mutually decided by NHAI and the road operator. The toll revenues will be routed to an escrow account.Recently, the NHAI awarded four such mega projects of 882 km length, which are likely to cost an estimated Rs 10,912 crore.From the NHAI perspective, these projects have emerged as money-spinners, with companies willing to foot the entire construction cost and part with two per cent to 48.06 per cent of their revenues in the initial leg of the project.At the end of the concession period, which is about 12 to 15 years duration, the winning firms have agreed to part with 12 per cent to 59 per cent share of toll revenues.More studies  The feasibility reports for another ten projects of similar nature are under preparation. They are: Kishangarh-Udaipur stretch (315 km, Rs 2,205 crore), Udaipur-Ahmedabad (235 km, Rs 1,645 crore), Varanasi-Aurangabad (190 km, Rs 1,330 crore), Nellore-Chilkaluripet (184 km, Rs 1,288 crore), Krishnagiri-Walajapet (148 km, Rs 1,036 crore), Pune-Satara (145 km, Rs 1,015 crore), Ludhiana-Chandigarh (85 km, Rs 595 crore), Belgaum-Dharwad (80 km, Rs 560 crore), Samakhiali-Gandhidham (56 km, Rs 392 crore), Indore-Dewas (55 km, Rs 385 crore).With access controlled expressways attracting massive investments, the Ministry of Road Transport and Highways has decided to conduct the feasibility study for four such expressways between Delhi-Meerut, Chennai-Bangalore, Vadodara-Mumbai and Dhanbad-Kolkata. This was decided by the Road Ministry officials at a meeting with State Government authorities recently.Source: http://www.thehindubusinessline.com

Private sector shying away from NE road projects

NEW DELHI, March 6 – The Centre may be ready with funds for developing the road sectors in the North-East, but projects have been hit with few takers from the private sector. The lack of response from the private sector has led a Parliamentary Panel to remark that it was disappointed to note that the government initiative did not yield much result in the development of road projects in the North Eastern States.President, Prathibha Devisingh Patil, while addressing the joint session of the Parliament had mentioned about infrastructure projects in the North-East. The SARDP- NE with a funding of Rs 43,000 crore has been formulated to construct, improve and widen roads in the region. However, the government’s offer so far has not yielded the desired results from the private players, slowing down implementation of the projects. The incentives announced by the government for participation of private sector in road sector of NER would invite good response and hopes that NES would get a better road connectivity, said the Parliamentary Standing Committee on Transport, Culture and Tourism.The Centre has a number of projects in the pipeline for the region including upgradation of 588 km of various National Highways (NHs) to two-lane under Phase A of Special Accelerated Road Development Programme for North-East (SARDP-NE) through private sector participation.The Centre had way back in 2005 cleared the construction of the projects on BOT basis. Thereafter, National Highway Authority of India (NHAI) invited bids for the most trafficked corridor from Jorabat to Barapani in Meghalaya. But there was no response from the bidders.Later, the Government sanctioned the projects on BOT (Annuity) basis. Further, NHDP:III B, which includes four lanning of 1051 km on NH in NER, has been cleared last year. Currently, detailed project report is under preparation by NHAI, the Committee has been told.It was recommended that the Department undertake a proper scientific study and take the consequent measure to modify the rules and procedures, if necessary, for participation of the private sector in road projects in North-East. Meanwhile, the Ministry has proposed quality audit for SARDP-NE, with possible involvement of IITs. The monitoring of quality of works would be considered through individual experts to be engaged through National Road Congress. Further, reputed institutes such as IITs would be involved for conducting tests and materials and works being executed by the contractor.

NHAI starts work on Rs6,672 cr expressway

The expressway itself will be 400km long and will cost around Rs16.68 crore per km New Delhi: The National Highways Authority of India, or NHAI, has started preliminary work on awarding its biggest contra-ct yet, worth Rs6,672 crore, for an expressway between Vadodara in Gujarat and Mumbai.Gujarat is among the most industrialized states in the country and a major hub for petrochemical and chemical companies. Mumbai is the country’s financial and commercial capital and is also home to India’s busiest port. The Vadodara-Gujarat route is a busy one in terms of freight traffic.Last year, NHAI awarded two contracts to IRB Infrastructure Developers Ltd and Larsen and Toubro Ltd (L&T) to upgrade stretches of highway between Bharuch and Surat and Vadodara and Baruch, respectively. These stretches are part of the existing highway between Mumbai and Vadodara that runs parallel to the proposed expressway.Officials in NHAI admit that traffic on the route is growing at a scorching pace.“We were always aware that an expressway would be built between Mumbai and Vadodara,” said V.D. Mhaiskar, chairman and managing director of IRB Infrastructure.The expressway itself will be 400km long and will cost around Rs16.68 crore per km. The largest contract awarded before this by NHAI was for Rs2,500 crore to build a highway between Panipat and Jalandhar, according to A.V. Sinha, member (technical), NHAI.NHAI, the regulator for the Indian highways sector and the entity responsible for the award of contracts to build roads, will appoint a consultant for the project and decide on other contours of the expressway by July. The call for bids will come after that and the expressway is expected to be completed by 2015.As is the case with most NHAI projects, the expressway will be built on a build-operate-transfer (BOT) basis wh-ere a private developer builds the road, operates it for a certain period, and then transfers ownership to the state.“The expressway will charge around 30% more in toll rates and, so, not all vehicles would shift to the expressway (from the highway),” said Sinha.The stretches owned by the IRB and L&T consortia are currenly being upgraded and are expected to be completed by July 2009.“There is a revenue share agreement between NHAI and us that if traffic exceeds 108,000 vehicles per day, we share that with the authority. By the time this expressway is built, we would have reached that mark,” Mhaiskar said.Mhaiskar estimated current traffic in the Bharuch-Surat stretch at between 60,000 and 70,000 vehicles per day.Source: http://www.livemint.com

Uttar Pradesh govt plans five more expressways

Combined length of 1,400km proposed; roads will be in vicinity of highways being developed by NHAI

The Uttar Pradesh government is planning five more expressways in the state even before it signs the concession agreement for the Rs40,000 crore Ganga Expressway project awarded in January.

And yet again, just as in the case of the Ganga Expressway, the proposed highways are coming up in the vicinity of the highways being developed by the National Highways Authority of India, or NHAI, the roads regulator.

“We will not approach the Centre for any kind of assistance in funding. As in the case of the Ganga Expressway, we will raise resources for these projects by leveraging land,” said an official, who was involved in the planning of the Ganga Expressway project as well, but did not wish to be identified.

Country roads: The Greater Noida expressway. UP had awarded the tender for the Rs40,000 crore Ganga Expressway project, which will connect Greater Noida with Baflia, to Jaypee Infratech Ltd in January. (Madhu Kapparath / Mint)

The tender for the Ganga Expressway project, which will connect Greater Noida with Ballia, was awarded to Jaypee Infratech Ltd in January. The concessionaire is expected to be leased around 7,000ha of land for commercial development in order to construct the expressway.

Jaypee had sought land worth Rs293.55 crore for property development along the expressway in order to construct the expressway.

The five proposed expressways will have a combined length of around 1,400km.

“We do not have a clear idea as to how much land will be required to be set aside for these projects, but we will be able to work out those details only after a few months,” the same official said.

The proposed expressways include the Greater Noida-Saharanpur-Dehradun (in partnership with the Uttarakhand state government) stretch apart from Jhansi-Lucknow, Lucknow-Gorakhpur, Agra-Kanpur-Lucknow and Farrukhabad-Kotdwar expressways.

The proposal for these projects is being developed by the state public works department. “First we will seek environmental clearance for these projects and then the proposals will go to the state cabinet for approval,” the official said.

Planning Commission member Anwarul Hoda said that the apex planning organization in the country has not yet been informed about the state’s plans to go in for more expressways. “We have not been told about these projects,” he said.

Earlier, the Planning Commission had held discussions with the UP administration on the Ganga Expressway project in order to see whether the project linked up with existing highway networks in the state. It gave the go-ahead despite the overlap with the highways being developed by NHAI.

“Tolling on these roads will barely pay for operations and management expenses,” said a consultant with a project management company, who did not wish to be quoted. “Remember, these roads are along the same alignment as existing NHAI national highways, which means traffic is going to be shared. So, the capital cost recovery will come from the land component only. If you are in the business of building highways, then why do you need all this land.”

Source: http://www.livemint.com

4-LANING OF DELHI-DEHRADUN NATIONAL HIGHWAY

Delhi – Dehradun National Highway has been identified for 4 laning under National Highway Development Project (NHDP) Phase III on Build, Operate & Transfer (BOT) basis. Widening to 4 lane work in Meerut-Muzaffarnagar section is in progress and delayed due to initial problem regarding tree cutting & land acquisition and is targeted to be completed by March, 2009. Widening to 4 lane work in Muzaffarnagar-Haridwar section could not be awarded as only single bid was received and the same was cancelled. For re-bidding of this section, updation of Detailed Project Report (DPR) as per new Model Concession Agreement (MCA) as decided by Public Private Partnership Appraisal Committee (PPPAC) is in progress.The Haridwar-Dehradun section is passing through Rajaji National Park and clearance is to be obtained from the Central Empowered Committee constituted by the Hon’ble Supreme Court of India. After clearance from Central Empowered Committee and PPPAC, bidding process is to be taken up for award of 4 laning work. This information was given by the Minister of State for Shipping, Road Transport and Highways, Shri K.H. Muniyappa in a written reply in the Lok Sabha today.  Source: http://pib.nic.in 

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