National Highways Authority of India has issued a default notice to the developer of the Gurgaon-Jaipur highway for its failure to complete work

in time and poor maintenance even after the end of the 60-day deadline for remedial measures. Sources said since the developer failed to remedy the defaults within the cure period, the authority is now free to take action, including taking over the toll collection for at least 180 days, as per the contract norms. The authority in its letter to Pink City Expressway Ltd has cited a dozen notices issued by the independent engineer of this project since May 13 highlighting defaults on the developer’s part.

The developer maintains that non-availability and late availability of land slowed down the highway work but NHAI officials said PCEL failed to complete some structures years after getting enough land. In its letter to the highways ministry NHAI has mentioned that the developer has made only about five percent progress in the past six months despite assuring to do more. The developer has also failed to provide 4-lane facility “at all times” during the construction period. NHAI has said that many structures are incomplete, forcing numerous diversions. As the crust thickness of these diversions is inadequate to cater to heavy traffic for long and they are poorly maintained, travel time has increased considerably. However, the authority admits that factors such as non-availability of land, non-cooperation of state agencies such as revenue, forest and irrigation departments, and frequent interventions by public representatives demanding modification and incorporation of new structures, have resulted in dismal progress. It has also said that the main reason for the poor progress is a funds crunch. The lenders for this project have stopped releasing money and even the escrow account, in which the collected toll is deposited, has been frozen. PCEL said NHAI “has intimated occurrence on the concessionaire’s deemed default based on the independent engineer’s wrong interpretation of the provision of the agreement and invalid and illegal advice”. It said that NHAI can’t take over the project after this notice since the dispute resolution mechanism is stipulated in the concession agreement. While NHAI and PCEL are caught in a blame game, industry sources said both are at fault. The developer, they said, has a huge financial problem and NHAI has defaulted on getting clearances and providing land.