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HomeTrendsGovt raises highway building target for FY24 to 14,000 km from 12,500...

Govt raises highway building target for FY24 to 14,000 km from 12,500 km

Govt raises highway building target for FY24 to 14,000 km from 12,500 km

The central government of India has expressed its optimism regarding the pace of road construction in the first quarter of the financial year 2023-24 (FY24), which has prompted them to consider increasing the highway-building target for the current year. Anurag Jain, the Secretary at the Ministry of Road Transport and Highways (MoRTH), has revealed that the road construction target for 2023-24 will be raised from the previously decided 12,500 km to an ambitious 14,000 km.

Under this revised target, different entities have been assigned specific responsibilities to contribute to the overall road construction efforts. The National Highways Authority of India (NHAI) has been given a target of constructing 6,000 km of roads, emphasizing the authority’s crucial role in expanding the highway network. Additionally, MoRTH itself will undertake the construction of another 6,000 km of roads, showcasing the government’s commitment to driving infrastructural development. To further augment the efforts, the National Highways & Infrastructure Development Corporation (NHIDCL) will play a significant role in building an additional 2,000 km of roads.

This decision to raise the highway-building target signifies the government’s recognition of the importance of robust infrastructure and efficient connectivity in driving economic growth and regional development. By embarking on an ambitious road construction plan, the government aims to enhance transportation networks, reduce travel times, promote trade and commerce, and create new opportunities for businesses and communities across the country.

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The increased focus on road construction not only enhances connectivity within India but also contributes to the larger vision of creating a well-connected and integrated transportation network, benefiting both urban and rural areas. By expanding the highway network, the government strives to improve accessibility, facilitate smoother movement of goods and services, and encourage regional development by attracting investments and promoting industrial growth in previously underserved regions.

Based on data provided by the Ministry of Road Transport and Highways (MoRTH), the pace of road construction in India experienced a notable increase in the first quarter of the current financial year. The data indicates that road construction rose by 9.4 percent compared to the same period in the previous year.

During the months of April to June, a total of approximately 2,150 km of roads were constructed, surpassing the 1,966 km built during the corresponding period in the previous year. This indicates a positive growth trajectory in road construction activities.

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The overall pace of road construction for the quarter was positively influenced by a significant improvement in May and June. Although construction started relatively slowly in April, the subsequent months witnessed a surge in construction activity. This acceleration in road construction during May and June played a pivotal role in bolstering the overall construction output for the quarter.

These statistics highlight the positive momentum and increased efforts in road construction in India. The rise in the pace of construction is a promising sign for the government’s infrastructure development initiatives, reflecting a proactive approach towards enhancing connectivity, improving transportation networks, and supporting economic growth across the country.

Senior officials from the Ministry of Road Transport and Highways (MoRTH) have acknowledged that the early monsoon in certain parts of the country had an impact on the pace of road construction. They noted that the construction progress could have been even higher if it weren’t for the rains.

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Additionally, the government has identified specific states for boosting road construction as part of its increased target for the year 2023-24. The states of Odisha, Tamil Nadu, Karnataka, Maharashtra, and Madhya Pradesh have been specifically mentioned as areas where road construction will be prioritized.

One of the officials explained that certain highway projects in these states were put on hold in the previous year due to issues related to land acquisition. However, the government has now resolved these issues, enabling them to accelerate highway construction in these states. This indicates a proactive approach by the government to overcome obstacles and ensure the smooth execution of road construction projects.

Despite the upcoming state assembly election scheduled for December, officials anticipate that the pace of road construction in India will remain strong. They highlight that many projects that were previously delayed due to challenges associated with land acquisition and payments have now been cleared. This suggests that the construction activities will continue without significant interruptions, contributing to the overall progress of road infrastructure development in the country.

These statements from senior officials indicate the government’s commitment to addressing obstacles and streamlining the road construction process. By resolving land acquisition issues and clearing pending projects, the government aims to maintain the momentum of road construction, even in the face of potential challenges such as the monsoon and upcoming elections.

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Road Minister Nitin Gadkari has called for an increase in the pace of road construction from the current target of 34 km per day to around 40 km per day. The central government aims to ramp up highway construction across the country in preparation for the upcoming Lok Sabha elections in 2024.

To expedite road construction, the Ministry of Road Transport and Highways (MoRTH) plans to utilize 91 percent of its budgetary allocation of Rs 2,58,606 crore by December, with Rs 59,078 crore already spent as of May-end.

In terms of construction methods, MoRTH intends to employ a mix of engineering, procurement, and construction (EPC), hybrid annuity, and build-operate-transfer (BOT) models for road construction in the fiscal year 2023-24.

Despite the optimistic outlook of the road ministry, industry experts and analysts anticipate a slowdown in the pace of road construction compared to the previous year. ICRA Research predicts a 25 percent decline in the awarding of road sector projects in 2023-24, resulting in the awarding of only around 9,000 km of highways, compared to over 12,000 km in the previous fiscal year.

The expected decline follows a similar trend observed before the 2019 general elections when the awards fell sharply from over 17,000 km in 2018 to approximately 5,500 km. ICRA also forecasts a 16-21 percent year-on-year increase in road execution activity in 2023-24, reaching 12,000-12,500 km, which falls short of the government’s target of 14,000 km.

MoRTH has faced challenges in meeting its highway construction targets in recent years. In 2022-23, the ministry constructed approximately 10,993 km of national highways, missing its target of 12,500 km. The pace of highway construction in India peaked in the pandemic-impacted year of 2020-21, with a record 13,327 km of highways built at a rate of 37 km per day.

While the road ministry initially aimed to construct 14,600 km of highways at a pace of 40 km per day in 2021-22, it revised the goal to 12,000 km and ultimately constructed 10,457 km. Similarly, in 2022-23, the target was set at 12,500 km, although Gadkari had previously suggested considering 18,000 km of highway construction at a daily rate of 50 km.

In summary, the government aims to accelerate road construction, but industry experts predict a slowdown in the awarding of projects and a potential shortfall in meeting the ambitious construction targets set by the Ministry of Road Transport and Highways.

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