India embraces PPP Model for high-quality highway construction
ROADS & HIGHWAYS

India embraces PPP Model for high-quality highway construction

The government's focus has shifted towards monetising completed highway projects, leading to a significant change in the construction approach for national highways (NHs). Instead of relying solely on government funding or engineering, procurement, and construction (EPC) methods, the National Highways Authority of India (NHAI) has embraced Public-Private Partnership (PPP) mode for nearly 85% of highway projects. This shift is motivated by the recognition that projects executed under PPP demonstrate superior quality and require less maintenance compared to government-funded initiatives.

Under this new policy, the NHAI will invite bids for the majority of highway projects through PPP, marking the first time that the road wing of the highways ministry will collaborate with private investors on fresh projects. The decision to favour PPP models, specifically the build-operate-transfer (BOT) and hybrid annuity model (HAM), was made in light of the proven track record of higher quality and reduced maintenance costs associated with these projects.

According to Union road transport secretary Anurag Jain, major projects exceeding Rs 5 billion will preferably be executed under PPP mode. Private players involved in PPP projects are required to maintain the highways for 15-20 years, ensuring a higher standard of construction due to their long-term responsibility.

This strategic shift is exemplified by the immediate maintenance carried out by private entities, spending approximately Rs 1 billion on each of the five highway stretches acquired from NHAI, which were initially built using EPC methods. In contrast, the remaining five corridors, constructed under PPP, did not require immediate attention, showcasing the durability and reliability of the PPP approach.

Union road transport minister Nitin Gadkari emphasised the advantages of roads constructed under BOT and HAM modes, highlighting that private investors' awareness of their long-term maintenance responsibilities leads to better construction quality. Consequently, the government plans to expand the construction of roads under these modes significantly, ensuring the development of high-quality, enduring highway infrastructure.

The government's focus has shifted towards monetising completed highway projects, leading to a significant change in the construction approach for national highways (NHs). Instead of relying solely on government funding or engineering, procurement, and construction (EPC) methods, the National Highways Authority of India (NHAI) has embraced Public-Private Partnership (PPP) mode for nearly 85% of highway projects. This shift is motivated by the recognition that projects executed under PPP demonstrate superior quality and require less maintenance compared to government-funded initiatives. Under this new policy, the NHAI will invite bids for the majority of highway projects through PPP, marking the first time that the road wing of the highways ministry will collaborate with private investors on fresh projects. The decision to favour PPP models, specifically the build-operate-transfer (BOT) and hybrid annuity model (HAM), was made in light of the proven track record of higher quality and reduced maintenance costs associated with these projects. According to Union road transport secretary Anurag Jain, major projects exceeding Rs 5 billion will preferably be executed under PPP mode. Private players involved in PPP projects are required to maintain the highways for 15-20 years, ensuring a higher standard of construction due to their long-term responsibility. This strategic shift is exemplified by the immediate maintenance carried out by private entities, spending approximately Rs 1 billion on each of the five highway stretches acquired from NHAI, which were initially built using EPC methods. In contrast, the remaining five corridors, constructed under PPP, did not require immediate attention, showcasing the durability and reliability of the PPP approach. Union road transport minister Nitin Gadkari emphasised the advantages of roads constructed under BOT and HAM modes, highlighting that private investors' awareness of their long-term maintenance responsibilities leads to better construction quality. Consequently, the government plans to expand the construction of roads under these modes significantly, ensuring the development of high-quality, enduring highway infrastructure.

Next Story
Resources

Ajmera Realty’s Bengaluru project launch sees strong festive sales

In a landmark achievement, Ajmera Realty & Infra India (ARIIL) launched a residential project – Ajmera Iris in Electronic City, Phase 2, Bengaluru. ARIIL sold 59,000 sq. ft. out of 1,58,859 sq. ft in the project for value of Rs 60 crores, which represents about 37 percent of ARIIL’s inventory sold, achieved within a week of its launch following RERA registration.ARIIL has reinforced its industry leadership with impressive pre-sales for its latest project, Ajmera Iris, in Bengaluru’s sought-after Electronic City. The project offers a wide of range of lifestyle amenities for an enhance..

Next Story
Real Estate

Godrej Properties wins 7.5-acre plot for luxury development in Gurugram

Godrej Properties (GPL) has secured a 7.5-acre plot on Golf Course Road, Gurugram, through an e-auction conducted by the Haryana Shehri Vikas Pradhikaran (HSVP). The plot offers a development potential of over 1.7 million square feet for luxury residential apartments, with an estimated revenue potential of Rs 5,500 crore. This marks the 11th project acquired by GPL in FY25, taking its total business development value to Rs 22,950 crore, exceeding its annual target of Rs 20,000 crore. GPL’s recent growth is highlighted by strong sales bookings, with a five-fold increase in net profit to INR 3..

Next Story
Real Estate

Godrej Summit buyers awarded compensation for missing amenities in Gurgaon

Flat buyers of Godrej Summit in Gurgaon, including Ravikant Bansal, Vivek Talwar, and Deepak Dhody, were compensated after the builder failed to provide promised amenities. The buyers had booked a Rs 2 crore flat, which was marketed with specific features like a 24-meter wide road access and full utilities. However, the project had multiple lapses, including a 10.06-meter road, water tankers, and power generators instead of consistent services. In a ruling on October 11, 2024, the National Commission ordered the builder to refund the entire amount along with 9% interest. The commission noted t..

Hi There!

"Now get regular updates from CW Magazine on WhatsApp!

Join the CW WhatsApp channel for the latest news, industry events, expert insights, and project updates from the construction and infrastructure industry.

Click the link below to join"

+91 81086 03000