The Central Government has set an ambitious target of awarding Rs 5 lakh crore worth of highway contracts, totalling about 50,000 km, in the last two years of its tenure, surpassing the cumulative road length awarded for paying in the last five years.
Union road minister, Nitin Gadkari said that the contracts will be for 44 economic corridors and 10 expressways, and would include the ‘chardham’ connectivity programme, northeast connectivity programme and the borders-linking projects. Over the last five years, the government could award only 40,000 km of fresh highway length for construction.
These new highways would decongest the existing roads, bringing down logistics cost by 5-6%, Mr. Gadkari said. His ministry’s vision is that a freight vehicle should move on highways without restrictions and should be able to do at least 400 km per day. It will have very positive impact on the logistics industry.
At present, there are 10 expressway projects at various stages of implementation. Gadkari said his ministry would raise money through NHAI bonds, monetization of highways and additional allocation in budgetary support. He said the Centre’s first expressway, the Eastern peripheral expressway, would be ready in a few months.
Most of these projects would be undertaken on the hybrid annuity model, where the government shares the project risk with the private partner and bears 40% of the project cost upfront.
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