Road ministry to approve projects with construction cost upto Rs 1K-cr

By: | Published: November 18, 2015 9:26 PM

In a bid to fast-track highways projects, the government today empowered Road Transport and Highways Ministry to approve projects with civil construction cost up to Rs 1,000 crore.

In a bid to fast-track highways projects, the government today empowered Road Transport and Highways Ministry to approve projects with civil construction cost up to Rs 1,000 crore.

This would be done by segregating civil construction cost from capital cost of projects.

The decision was taken in a meeting of the Cabinet Committee on Economic Affairs (CCEA).

“The CCEA, chaired by Prime Minister Narendra Modi, has given its approval to segregate construction cost from cost for land acquisition, centages and pre-construction activities…

“… all NH projects with a civil construction cost of up to Rs 1,000 crore shall be appraised by SFC/EFC/PIB, headed by Secretary, Road Transport and Highways and approved by Minister, Road Transport and Highways,” an official statement said.

It said all National Highways projects with a civil construction cost above Rs 1,000 crore shall be appraised by PPPAC/EFC/PIB, headed by Secretary, Department of Economic Affairs/Expenditure and approved by CCEA.

Briefing the media after the Cabinet meeting, Coal and Power Minister Piyush Goyal said this will “empower the Ministry” and it would not be required to go back again and again (to Cabinet) for each individual project but within a policy framework help to revive all these stalled projects.

The government said, “By adopting the policy, the avoidable delays in the process of appraisal and approval of NH projects will be suitably addressed. Speedy appraisal and approval will help in meeting the award target of 10,000 km set for this year.”

Currently, as per standard practice before getting an investment approval from the Cabinet/Cabinet Committee, all

NH projects are first appraised by SFC/EFC/PIB/PPPAC.

In addition to the above, many rounds of appraisal are also carried out by various committees like the Standing Cost Committee, etc. under the Ministry of Finance, MoRTH and/or NHAI to examine its viability and cost effectiveness.

PPPAC is an appraisal body for infrastructure projects to be implemented on Build-Operate-Transfer (BOT) (Toll, Annuity and now Hybrid Annuity) under the Ministry of Finance, Department of Economic Affairs having representation of Ministry of Finance as well as NITI Aayog, Ministry of Road Transport and Highways, Department of Legal Affairs, and NHAI.

The government said multiple stages of examination and appraisal of the same project by different Ministry/ Department/Committees cause avoidable delays in award of NH projects.

Taking note of such difficulties and with a view to minimise levels of decision making, the CCEA has empowered the Ministry of Road Transport and Highways to decide on the change in the mode of delivery of individual NH projects.

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