The National Highways Authority of India (NHAI) on Wednesday issued an “intention to termination notice” to Roadways Solutions India Infra Ltd (RSIL) for failing to meet construction targets on a 35-km stretch of the Delhi-Mumbai Expressway, a report by The Times of India said. This notice is the final step before cancelling a contract. Work on this stretch in Gujarat has moved very slowly, achieving only 4.9% of the physical work and 4.6% of the planned spending against the target, the report added.
Work on two other stretches in Gujarat, measuring 27 km and 25 km, is also moving slowly, with progress at 23% and 36% respectively. The poor pace of construction could push the revised completion deadline of the project beyond March 2028, the outlet reported citing sources.
Pune-based RSIL is an engineering and construction firm mainly involved in road and highway projects. The company had won the expressway packages in Gujarat in 2021.
Contracts terminated earlier, then re-awarded
Interestingly, NHAI had terminated RSIL’s contract for two stretches in March 2023, but re-awarded them to the same company in November 2023 after it again emerged as the lowest bidder. In a letter to RSIL, NHAI said the “intention to termination notice” was issued due to the contractor’s “absolute and continued non-performance”.
It said, “despite the contractor having been granted repeated indulgences and more than adequate opportunities through the execution of three settlement agreements, the contractor has achieved a negligible financial progress of only 4.59% (after lapse of 16 months from the appointed date of Aug 31, 2024)”.
Project timeline badly missed
According to the letter, as per the original timeline of 18 months starting August 31, 2024, the contractor should have completed around 70% financial progress by now. The authority said the extremely low progress even after 16 months clearly shows that completion of the Jujuwa-Gandeva section of the expressway by November 15, 2026 “is wholly impossible”.
NHAI said that despite giving repeated chances and extended support, the contractor “failed to demonstrate any improvement or to achieve the requisite progress”. It added that even after signing three settlement agreements, RSIL did not meet the agreed targets. “In the settlement agreements, it was specified that if it fails to achieve agreed milestones, NHAI will terminate the contract without any cure period notice. So, we have served the notice,” an official told TOI.
A cure period notice is usually issued to give a contractor 60 days to fix shortcomings. NHAI said this communication should be treated as a “15-day notice” under the contract, after which the authority “shall be entitled to terminate the contract agreement”. It also said the incomplete work on the three RSIL packages is causing major public inconvenience on several fronts. For two other sections, NHAI is likely to issue a cure period notice to RSIL.