Even as the government is sharpening its focus on road infrastructure development in the country, about a third of the total highway projects awarded since 2000 by the government are stuck in arbitration involving a sum of Rs 8508 crore.

According to official data, as many as 123 highway projects out of a total of 406 awarded so far by the National Highways Authority of India are stuck in arbitration.

Major firms engaged in arbitration include Larsen and Toubro which has five projects under dispute settlement involving an amount of Rs 576.45 crore. Similarly, Hindustan Construction Company has three projects with Rs 73.54 crore under arbitration.

Nagarjuna Construction and Gammon India have two projects involving Rs 66.39 crore and three projects involving Rs 61.04 crore, respectively.

As many as 119 projects under dispute are EPC (Engineering procurement construction) contracts while the rest are on build- operate-transfer (BOT) annuity basis.

Disputes relate to...

The disputes relate to various reasons like price escalation, royalty charges on minerals, entry tax and removal of utilities on acquired land for road construction.

"Very few cases are stuck over problems relating to land acquisition. They are mostly over removing utilities and other issues which are to be taken care of by the private developers themselves," said a senior government official.

The government has awarded 406 projects since the start of the public-private partnership for road building in 2000, out of which 309 are on EPC basis.

Out of the 123 projects under arbitration, 103 are in Dispute Review Board, formed by the National Highways Authority of India, while the rest are in various courts.

Under EPC contracts, the government pays the cost of developing the roads to the private contractor upfront while in BOT-Annuity arrangement, the government gives out the investment for construction and maintenance of highways in six monthly instalments.

Meanwhile, the Authority will appoint a financial consultant shortly to look at options for raising about Rs 1.20 lakh crore for road construction in the next few years.

Rs 3.38 lakhs crore plan...

NHAI needs a total of Rs 3.38 lakh crore for building 37,000-km of highways across the country in the next 4-5 years under public-private-partnership model. Of this, private participants are expected to bring in Rs 2.11 lakh crore.

“Soon we are appointing a financial consultant which will workout a credit plan for NHAI and a system for raising the credit and the finances according to the work plan,” NHAI Member Finance A Didar Singh told PTI Economic Service.

The Ministry of Transport has drawn up a 'Work plan' to award about 11,800 km of highways development projects in the current fiscal that may entail a total investment of Rs 1 lakh crore. Similarly, in the next fiscal it plans to construct another 11,800-km of highways. NHAI, which is responsible for development and maintenance of national highways, meets its financial needs through cess on sale of fuel, borrowings from international lending agencies and the financial market.

Contracts for development of about 37,000 km national highways is targeted to be given out in the next few years.

The total length of national highways in the country is about 70,548 km.

The authority is also planning to come up with a Standard Maintenance Manual by the end of this month that will help in the upkeep of the Golden Quadrilateral and other highway stretches in the country.