Given the states’ demand that one-time improvement (OTI) works on national highways be funded by the Centre, the ministry of road transport and highways (MoRTH) has directed the National Highways Authority of India (NHAI) to carry out such works out of budgetary allocations or borrowed funds. When a national highway (NH) stretch gets congested, a stretch is developed bypassing the stretch. Upon requests from the state, while NHAI develops the new stretch, MoRTH had earlier taken upon itself the task of redeveloping the existing stretch since 2015-16, which otherwise is the duty of the state through which the highway passes through.
However, MoRTH does not want to carry on with the activity, which used to burden it with around Rs 1,000 crore a year, any longer. This is because of limited budgetary allocation. Outgoing secretary Sanjay Mitra, who is set to take over as defence secretary, has already communicated the ministry’s decision to NHAI chairman Y S Malik.
“The ministry has been receiving several proposals for one-time improvement (OTI) works from states/NHAI for implementation under NH (O). Keeping in view the limited available budgetary allocations under NH (O) and the need to focus on development of existing non-NHDP NHs and development of NHs approved in-principle in a time-bound manner, it has been decided that all new works of OTI, shall, henceforth, be implemented by NHAI,” he wrote.
“NHAI shall implement OTI works out of the budgetary allocations and additional resources mobilised through market borrowings of NHAI. No additional Gross Budgetary Support (GBS) funds to be earmarked to NHAI for these works,” he added. NHAI, which spent around `70,000 crore for development of highways last fiscal, however, is not perturbed. A senior authority official said the additional annual burden on NHAI would not be more than `1,000 crore as the ministry says no additional GBS funds must be given for such works.
“This will not impact NHAI’s works since the amount is pretty small,” he said. Taking in toll collection and cess on highways, NHAI is likely to get around `20,000-crore budgetary support from the ministry out of the total `64,900 crore budgetary allocation for the 2017-18 fiscal.
NHAI raises funds through bonds for highways development. Last fiscal, it raised around `40,000 crore through both taxable and tax-free bonds in 2016-17, a quantum jump from the previous three years’ average of `24,000 crore. However, in 2016-17 too, it could not exhaust the permissible limit of `59,297 crore. The limit has been kept at the same level in the current fiscal. NHAI has been asked to construct 6,000 km and award 10,000 km highways in the current fiscal.