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Mint
17-06-2025
- Business
- Mint
Facing road construction quality issues, Centre takes away state PWD and state department's powers for bidding out NHs
The Centre has withdrawn the powers of state PWDs (public works departments) and road construction departments (RCDs) to independently issue bid documents for national highway projects in their states, according to a directive by the ministry of road transport and highways (MoRTH). Instead, they will now consult MoRTH's regional officers (ROs), who will evaluate all state-issued bids, recommend necessary changes, and actively participate in resolving legal and arbitration disputes related to national highway works, the directive said, a copy of which was seen by Mint. The new process will be applicable to all highway projects, including those costing less than ₹100 crore but excluding maintenance works. Further, ROs would need to be consulted at every step in the case of contractual disputes and arbitration. MoRTH is preparing a separate, detailed standard operating procedure (SoP) for dealing with arbitration matters that will soon be issued. Also read: Bhel likely to be tendering agency for EV charging stations under PM E-drive Queries emailed to MoRTH remained unanswered. The National Highways Authority of India (NHAI) is responsible for highway construction across the country. However, it often works with state-level agencies for bidding, processing, and building specific highway sections within their states, along with other agencies like NHIDCL and MoRTH's construction wing, The ministry's directive pointed out that 'in several projects pertaining to NH works implemented by State PWDs/RCDs, critical lapses have occurred due to lack of due diligence". That has led to disputes, legal complexities and financial liabilities for the central government, the directive noted, adding that ROs are not consulted or involved during bidding or in the courts, and the disputes are dealt with mechanically without safeguarding the interests of the Centre. The directive has been sent by the MoRTH to secretaries and chief engineers of all states and Union territory PWDs, RCDs and departments dealing with national highways. According to Jagannarayan Padmanabhan, senior director & global head at Crisil Intelligence, scrutinising all proposals from all state governments has its merits and demerits. 'The merits of such an exercise could mean avoidance of construction of parallel and competing roads, having a uniform bid awarding process across the country, and standardization of processes and bid documents, among other things," Padmanabhan said, adding that on the flip side, an additional layer of scrutiny and capacity augmentation at the central level would be needed. Suprio Banerjee, vice president and co-group head at rating agency Icra Ltd said that these measures are likely to increase the award timelines, but project execution is not likely to be hampered while adhering to the norms or standards stipulated by the road ministry. Also read: Nitin Pai: Train more civil engineers to solve our infrastructure crisis 'Also, the involvement of ROs in all legal contractual processes is expected to streamline the disputes adjudication process while avoiding the need for repetition," Banerjee said. 'Land acquisition being a state subject, the coordination between central and state government departments remains crucial to expedite the ROW and other associated approvals." However, Shailesh Agarwal, partner for risk consulting (infrastructure) at EY India sounded a cautionary note when he said that uniform documents don't necessarily mean smoother highways. 'Ultimately, true quality improvement depends on regular quality controls, digitalisation, and accountability at the ground level," he said. 'Due care must be taken to ensure that the new system doesn't become a fresh bottleneck." The disputes process With regard to contractual disputes and arbitration, it has been decided that state PWDs/RCDs would not pursue such matters independently without consultation with ROs. All replies, statements of defence, and written submissions intended for courts / arbitrations shall be vetted by the ROs and returned after scrutiny with comments or amendments before submission within a period of 15 days failing which the replies, statements or submissions may be deemed cleared. The ROs would also be free to engage legal experts from NHAl-empanelled law firms for advice and support. The highway building plan In FY26, MoRTH proposes to construct about 10,000 km of highways, per the outcome budget 2025-26. As highway construction in the country matures, the liberal growth in construction is expected to slow and the focus will shift towards highway maintenance and enduring quality of construction. Out of 146,195 km length of national highways (NH) network in the country, damages have been reported in about 1% of the stretch every year, according to data from MoRTH. The conditions of NHs are assessed from time to time by the MoRTH and its various executing agencies. Also read: Ajit Ranade: West Asia's upheaval intensifies India's challenges of geopolitics The maintenance works on NHs are accordingly taken up from time to time to keep the NHs in traffic-worthy condition. According to MoRTH, the ministry spent nearly ₹6,500 crore on highway repair and maintenance in FY24. A similar level of expenditure is also expected to be incurred in the current fiscal.
Time of India
09-06-2025
- Automotive
- Time of India
Under a new toll policy, road users may pay toll on per km basis
Under a new toll policy which is currently being formulated, the Ministry of Road Transport and Highways is mulling over a framework wherein users of India's highways and expressways can pay charges based on per km basis rather than existing norm of paying a predetermined toll fee. Currently, toll fee is paid on a fixed amount based on the length of stretch under one road project which is normally 60 km, as per the National Highways Fee (Determination of Rates and Collection) Rules, 2008. 'Under the new toll policy , the government is exploring ways to enable users to pay toll based on per km of usage of highways and expressways. In the existing system, users pay a fixed toll irrespective of whether they use the highway stretch for a few km or for the entire length,' a senior government official, aware of the development, told ET Infra. The Minister for Road Transport and Highways Nitin Gadkari had reportedly stated that under the new system, the requirement of physical toll plaza for collection may not be needed. The country in the last few years has seen the deployment of FASTag, a device that employs Radio Frequency Identification or RFID technology for making cashless toll payments without having to stop at toll booths. The government is now in the process of rolling out an enhanced toll system which will be based on Automatic Number Plate Recognition (ANPR) technology, in order to facilitate the implementation of the new toll policy. 'The idea is to ensure that there is no pilferage and revenue loss to the government,' said the official, adding that the new system may incorporate satellite tracking technology as well. The Minister for Road Transport and Highways had reportedly stated that under the new system the requirement of physical toll plaza for collection may not be needed. According to the Ministry of Road Transport and Highways, the ANPR-FASTag-based Barrier-Less Tolling System will be implemented at selected toll plazas. The system will enable vehicles to be charged based on their identification through high performance ANPR cameras and FASTag Readers, without needing to stop at the toll plazas. In case of non-compliance, e-notices will be served to the violators, non-payment of which may result in suspension of FASTag and other related penalties. 'This can be considered as a proactive initiative adopted by the government to adopt a barrier-less tolling will result in seamless toll collection, reduce travel time, eliminate stoppage time at toll plazas, especially during peak traffic hours,' said Jagannarayan Padmanabhan , Senior Director & Global Head, Crisil Intelligence. Existing Concessionaire Agreement Currently, private companies or entities engaged in the construction and maintenance of highways and expressways are allowed to collect tolls and recover their investment under a concession agreement. The official highlighted that under the new toll policy, it is being mulled that revenue be shared with the concessionaire through a centralised pool. 'As the toll collection will become automatic without any intervention at the toll plazas, it is being contemplated that the revenue will be shared with the various concessionaires through a centralised pool by the central government, so that there is no revenue loss to them even if the user is being charged on a per km basis and not a fixed standard rate,' the official said. The official highlighted that under the existing system there are instances wherein the private operator does under-reporting of revenue generated via toll and the new system is aimed at stopping such acts. Padmanabhan highlighted that if the new policy transfers the risk of default payments to the concessionaires, then they must bear the risk. 'There will be no significant adverse impact on the existing concession agreements on toll collections as the technology will promote barrier free tolling systems, which will result in smooth traffic flow and enhanced revenues. However, if the policy transfers the risk of default payments to the concessionaires, they must bear the risk of delayed payments until the default is cured,' said Padmanabhan. According to a statement from the Ministry of Road Transport and Highways, the National Highways Authority of India has invited bids for the implementation of 'ANPR-FASTag-based Barrier-Less Tolling System' for installation at select toll plazas and based on the performance, efficiency, and user response to this system, a decision will be made regarding its implementation across the country.
Time of India
08-06-2025
- Automotive
- Time of India
New Toll Policy: India to Introduce Per Km Tolling System for Highways, ET Infra
Advt Advt By , ETInfra NEW DELHI: Under a new toll policy which is currently being formulated, the Ministry of Road Transport and Highways is mulling over a framework wherein users of India's highways and expressways can pay charges based on per km basis rather than existing norm of paying a predetermined toll toll fee is paid on a fixed amount based on the length of stretch under one road project which is normally 60 km, as per the National Highways Fee (Determination of Rates and Collection) Rules, 2008.'Under the new toll policy , the government is exploring ways to enable users to pay toll based on per km of usage of highways and expressways. In the existing system, users pay a fixed toll irrespective of whether they use the highway stretch for a few km or for the entire length,' a senior government official, aware of the development, told ET Minister for Road Transport and Highways Nitin Gadkari had reportedly stated that under the new system, the requirement of physical toll plaza for collection may not be country in the last few years has seen the deployment of FASTag, a device that employs Radio Frequency Identification or RFID technology for making cashless toll payments without having to stop at toll booths. The government is now in the process of rolling out an enhanced toll system which will be based on Automatic Number Plate Recognition (ANPR) technology, in order to facilitate the implementation of the new toll policy.'The idea is to ensure that there is no pilferage and revenue loss to the government,' said the official, adding that the new system may incorporate satellite tracking technology as well. The Minister for Road Transport and Highways had reportedly stated that under the new system the requirement of physical toll plaza for collection may not be to the Ministry of Road Transport and Highways, the ANPR-FASTag-based Barrier-Less Tolling System will be implemented at selected toll plazas. The system will enable vehicles to be charged based on their identification through high performance ANPR cameras and FASTag Readers, without needing to stop at the toll plazas. In case of non-compliance, e-notices will be served to the violators, non-payment of which may result in suspension of FASTag and other related penalties.'This can be considered as a proactive initiative adopted by the government to adopt a barrier-less tolling will result in seamless toll collection, reduce travel time, eliminate stoppage time at toll plazas, especially during peak traffic hours,' said Jagannarayan Padmanabhan , Senior Director & Global Head, Crisil private companies or entities engaged in the construction and maintenance of highways and expressways are allowed to collect tolls and recover their investment under a concession official highlighted that under the new toll policy, it is being mulled that revenue be shared with the concessionaire through a centralised pool.'As the toll collection will become automatic without any intervention at the toll plazas, it is being contemplated that the revenue will be shared with the various concessionaires through a centralised pool by the central government, so that there is no revenue loss to them even if the user is being charged on a per km basis and not a fixed standard rate,' the official official highlighted that under the existing system there are instances wherein the private operator does under-reporting of revenue generated via toll and the new system is aimed at stopping such highlighted that if the new policy transfers the risk of default payments to the concessionaires, then they must bear the risk.'There will be no significant adverse impact on the existing concession agreements on toll collections as the technology will promote barrier free tolling systems, which will result in smooth traffic flow and enhanced revenues. However, if the policy transfers the risk of default payments to the concessionaires, they must bear the risk of delayed payments until the default is cured,' said to a statement from the Ministry of Road Transport and Highways, the National Highways Authority of India has invited bids for the implementation of 'ANPR-FASTag-based Barrier-Less Tolling System' for installation at select toll plazas and based on the performance, efficiency, and user response to this system, a decision will be made regarding its implementation across the country.
Time of India
01-05-2025
- Business
- Time of India
Road ministry imposes additional performance security on low bids
The ministry of road transport and highways has imposed additional performance security on bidders of road projects for bids lower than the estimated cost of the project while also doing away with the earlier criteria of imposing additional security on a case-to-case basis. #Pahalgam Terrorist Attack Nuclear Power! How India and Pakistan's arsenals stack up Does America have a plan to capture Pakistan's nuclear weapons? Airspace blockade: India plots a flight path to skip Pakistan The move, which will increase the cost of projects for the bidders, is aimed at doing away with the trend of abnormally low bid prices in national highway projects . 'The matter has been reviewed considering the trend of abnormally low bid prices in national highways projects and it has been decided that, henceforth, additional performance security will be taken from select bidder for low bid,' the ministry said in a circular dated 30 April, 2025. Sponsored Links Sponsored Links Promoted Links Promoted Links You May Like Gentle Japanese hair growth method for men and women's scalp Hair's Rich Learn More Undo As per the circular, additional performance security will be 0.1% for every percentage of bid price below 10% of the project cost in case the bid price is below 10% but not less than 20% and this will be applied on the bid price. In cases where the bid price is 20% or more below the project cost, the additional performance guarantee percentage shall be incremented by 0.2% for every percentage of bid price in addition to 1% of the bid price, it said. Live Events 'The additional performance security shall be treated as part of performance security,' it added. The changes will be effective from the date of the notification. 'Cost impact on the bidder will be higher if he bids below 10% of the project cost which will be an additional performance guarantee to be kept with the authority,' Jagannarayan Padmanabhan, senior director and global head, consulting, CRISIL Market Intelligence and Analytics said. Until now, the additional performance security was limited to 3% of the bid price offered by the selected bidder and was levied only when the bid price was below 20% and after the approval of the road secretary on a case-to-case basis.
