Lok Sabha Question No. 2231 (UNSTARRED), answered on 2018-03-08
Subject: PPP Road Projects
Ministry: ROAD TRANSPORT AND HIGHWAYS
Asked by: CHANDRAKANT BHAURAO KHAIRE, Pratyusha Rajeshwari Singh

## GOVERNMENT OF INDIA MINISTRY OF ROAD TRANSPORT AND HIGHWAYS

## LOK SABHA

## UNSTARRED QUESTION NO. 2231

ANSWERED ON 08 TH  MARCH, 2018

## PPP ROAD PROJECTS

## 2231. SHRI CHANDRAKANT KHAIRE:

## SHRIMATI PRATYUSHA RAJESHWARI SINGH:

## Will the Minister of ROAD TRANSPORT AND HIGHWAYS

## सड़क परिवहन औि िाजमार्ग मंत्री

be pleased to state:

- (a) the road projects being undertaken by the National Highways Authority of India under Public Private Partnership (PPP) mode;
- (b) whether the Government has not been able to attract private investments in the road sector under (PPP) mode and if so, the details thereof along with the reasons thereof including the corrective steps being taken in this regard;
- (c) whether  a  delegation  recently  visited  Malaysia  to  study  road  projects  and  seek investments and if so, the details thereof;
- (d) the extent of increase in public private partnership in road construction sector during the last three years along with the total investment made under the PPP mode in road construction sector till 31 December 2017;
- (e) whether the amount of NPA has increased to a large extent on fund invested for road construction under public-private partnership if so, the reasons therefor; and
- (f) the  number  of  National  Highways  Projects  being  implemented  across  the  country under public-private partnership along with the details thereof?

## ANSWER

## THE MINISTER OF STATE IN THE MINISTRY OF ROAD TRANSPORT AND HIGHWAYS

## (SHRI MANSUKH L. MANDAVIYA)

(a):  253  road  projects have been undertaken by National Highway Authority of India under Public Private Partnership (PPP) mode;

(b): No madam.

It is true that there was a decline in award of highway projects in 2012-13 and 2013-14 and  attracting  private  investment  under  PPP  was  difficult.  Reasons  for  the  same included  inadequate  project  preparatory  activities,  land  acquisition  prior  to  project award,  over-leveraged  financials  for  the  highway  developers  in  the  country,  lack  of debt  products  aligned with  revenue  stream  profile  of  highway  projects,  some  banks reaching the ceiling as per sectoral exposure norms and aggressive bidding based on unrealistic traffic projections.

However, corrective Steps were taken by MoRTH to address the above which included one  to  one  interaction  with  contractors/concessionaires  and  other  stakeholders, making amendments in contract document templates and implementing an innovative implementation  model  under  PPP  mode  i.e.  the  Hybrid  Annuity  Model.  As  a  result, award and construction of highway projects picked up, including projects under PPP mode. Till date 54 projects have been awarded under the Hybrid Annuity Model with aggregate length of 3,390 km and total cost of around Rs 60,000 crore.

(c): No, Madam.

(d):     The road project under PPP mode in last three years are as follows:-

| YEAR                    |   NO. OF PROJECTS |   LENGTH (IN KM) | INVESTEMENT (IN Rs. CRORES)   |
|-------------------------|-------------------|------------------|-------------------------------|
| 2015-16                 |                15 |             1109 | 18890                         |
| 2016-17                 |                37 |             2739 | 38,974                        |
| 2017-18( till Dec 2017) |                11 |              701 | 15,981                        |

The  Total  investment  made  under  the  PPP  Mode  in  road  construction  Sector  till December 2017 (April 2015 to December 2017) is around Rs. 73,845 crores.

(e):        NPA  for  the  highways  sector  have  been  addressed  to  a  large  extent  by  the Ministry and NHAI by resolving issues for awarded but languishing projects. Proactive policy measures like allowing 100% equity divestment two years post COD, premium deferment in stressed projects, rationalized compensation to concessionaires for languishing NH projects in BOT mode for delays not attributable to concessionaires and  one  time  fund  infusion  have  been  taken.  As  a  result,  all  the  NH  projects languishing around three years back have been suitably revived. (f): Currently,  70  National  Highway  Projects  are  being  implemented  across  the country  under  PPP  mode.  They  have  overall  cost  of  Rs.82,  672  crores  &  aggregate length  of  5,421  km.  Out  of  these,  54  projects  are  under  Hybrid  Annuity  Model  with overall cost of around Rs. 60,000 Crores and length of 3,390 km. Balance 16 projects are under BoT Mode with overall cost of around Rs 23,000 crores and aggregate length

- of 2031 KM.
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