The fate of developing approximately 8,000 km of National Highway (NH) stretches under the flagship Bharatmala program is uncertain as the finance ministry directs the road transport and highways ministry to obtain fresh Cabinet approval before approving and bidding out new projects. The revised cost of the Bharatmala program, doubling to Rs 10.6 lakh crore, awaits approval amid ongoing inter-ministerial discussions.
The finance ministry’s directive halts approval and bidding processes until the revised cost is approved. The road ministry has instructed its agencies, including the National Highways Authority of India (NHAI), NHIDCL, and the Road wing, to strictly adhere to this directive. This includes refraining from creating additional liabilities, such as those related to land acquisition and pre-construction activities, without the approval of the competent authority.
The Bharatmala program, initially approved by the Cabinet in 2017 for 34,800 km of NH, has faced cost escalation challenges. The revised cost, which has not yet been approved, stands at Rs 10.6 lakh crore, up from the initially estimated Rs 5.3 lakh crore. This increase is attributed to factors like higher land acquisition costs and changes in project composition.
The road ministry’s monthly report to the Cabinet highlights a 50% fall in awards for construction and widening during April-October compared to the same period last year. The ministry emphasizes the need for timely decisions on the approval of the revised Bharatmala Phase-1 or an alternate program to meet annual targets for awards.
While consultations on the revised estimated cost of Bharatmala-1 are underway, the direction from the finance ministry adds complexity to the already delayed project. The government is expected to continue funding awarded projects to ensure a smooth flow of funds.
