NHAI awards Rs7,500-cr worth projects

The National Highways Authority of India (NHAI) awarded eight projects spanning 815-km worth Rs7,500-crore in a board meeting held earlier this week. This takes the total number of projects awarded to 59 since January 2010.


According to a highly placed NHAI official, “the tendering process gathered steam in the fourth quarter of 2009-10. The first two months of the current financial year has seen a sustained awarding of the contracts. By March, about 38 projects were awarded and in April this year, we cleared 13 projects.”


Of the eight projects awarded recently by the authority, five are on build operate transfer (BoT) -- toll basis and the remaining will be taken up on BoT -- annuity. Both are models of public-private partnership in highways construction.


In toll mode, the developer earns return on investment through toll revenue over the construction period and in annuity he gets a pre-fixed sum from the government, which retains the tolling rights with itself.


Some of the major projects awarded include six-laning of the Delhi-Agra section requiring an investment of Rs 1,928 crore by the Reliance Infrastructure.


The concession period for the project is 26 years, including the concession period of 910 days.


Another major project, Nagpur-Saonar-Betul, requiring an investment of around Rs2,500-crore has been bagged by Oriental Construction and Engineering. This project will be taken up on annuity basis.


In case of two of the eight projects recently bid out, the developers have demanded government grant close to the upper cap of 40 per cent.


The developers can demand viability gap funding up to 40 per cent from the NHAI during the construction phase. Developers Abhijit Infrastructure and KSS Valecha Consortium were the lowest bidder demanding 37.90 per cent and 38.73 per cent, in case of two projects,
respectively.