Lok Sabha Question No. 3218 (UNSTARRED), answered on 2016-08-04
Subject: Cost and Time Overrun of Highway Projects
Ministry: ROAD TRANSPORT AND HIGHWAYS
Asked by: SANTOKH SINGH CHAUDHARY, SANTOSH KUMAR, ASADUDDIN OWAISI, Kantilal Bhuria, K. KAMARAAJ

be pleased to state:

- (a) whether there has been cost and time overrun in many National Highway projects particularly in Punjab, Haryana, Madhya Pradesh and Gujarat;
- (b) if  so,  the  details  thereof  during  each  of  the  last  three  years  and  the  current  year,  State  and project-wise;
- (c) whether  with  the  aim  to  minimize  the  cost  overrun  and  delays  in  completion  of  highway projects his Ministry is amending the process of project preparation, if so, the details thereof;
- (d) whether the Government has asked the consultant preparing Detailed Project Report (DPR) to get  statutory  environmental  clearance,  if  so,  the  details  thereof  along  with  the  payment  of consultancy fee for DPR has been linked with clearance and progress of work; and
- (e) the corrective measures taken by the Government to expedite the work on these projects?

## ANSWER

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

## (SHRI PON. RADHAKRISHNAN)

(a) to (c) Some National Highway projects have been delayed mainly due to land acquisition, utility shifting, non-availability of soil/aggregate, poor performance of contractors, environment/forest/wildlife clearances, ROB &  RUB  issues with Railways, public agitation for additional facilities, arbitration/contractual disputes with contractors etc. The details of delayed  projects  are  annexed.  Cost  overrun  is  applicable  only  to  EPC/item  rate  contracts.  In  such contracts,  there  is  a  provision  for  payment  of  escalation  due  to  delay  if  it  is  not  attributable  to Contractor.  In  case  the  project  is  delayed  due  to  reasons  attributable  to  the  Contractor,  liquidated damages  are  to  be  imposed  and  no  escalation  is  payable.  Actual  escalation  due  to  delay  or  cost overrun is known only after completion of the project and final settlement of bills.

## GOVERNMENT OF INDIA MINISTRY OF ROAD TRANSPORT AND HIGHWAYS

## LOK SABHA

## UNSTARRED QUESTION NO. 3218 ANSWERED ON 4 TH  AUGUST, 2016

## COST AND TIME OVERRUN OF HIGHWAY PROJECTS

3218.  SHRI SANTOKH SINGH CHAUDHARY:

SHRI SANTOSH KUMAR:

SHRI ASADUDDIN OWAISI:

SHRI KANTI LAL BHURIA:

DR. K. KAMARAJ:

## Will the Minister of ROAD TRANSPORT AND HIGHWAYS सडक परिवहन औि िाजमार्ग मंत्री

(d) Obtaining statutory clearance is the responsibility of project proponents. However, the DPR consultants  prepare  the  required  documents,  including  application  in  prescribed  formats  and  assist NHAI in presenting the case before the appraisal authorities. Payment of consultancy fee to the DPR consultants includes these deliverables.

(e) Various steps have been taken which include streamlining of land acquisition, streamlining of environment clearances,  exit for equity investors, premium re-schedulement, securitization of road sector loans, close coordination with other Ministries, revamping of dispute resolution mechanism, frequent reviews at Minister levels, etc. Other than this, following steps have been taken:

-  One  time  fund  infusion  to  revive  and  physically  complete  languishing  BOT projects;
-  Permitting 100% equity divestment after two years of construction completion for all BOT projects;
-  Harmonious substitution in the event of financial and concessionaire's default;
-  NHAI has been authorized to  extend  the concession period  for all current projects in  BOT  (Toll)  mode,  except  for  projects  where  tolling  is  permitted  from  the Appointed  Date,   which  are   languishing   during  the  construction  period  due  to causes NOT attributable  to the concessionaire, subject to certain conditions. Further,  NHAI  has  also  been  authorized to  pay  annuities to  the  concessionaire corresponding to the actual period of delay NOT attributable to the concessionaire upon successful completion of the project i.e on achieving COD.

ANNEXURE REFERRED TO IN REPLY TO PARTS (a) TO (c) OF LOK SABHA UNSTARRED QUESTION  NO.  3218  ANSWERED  ON  04.08.2016  ASKED  BY  SHRI  SANTOKH  SINGH CHAUDHARY, SHRI SANTOSH KUMAR, SHRI ASADUDDIN OWAISI, SHRI KANTI LAL BHURIA,  DR.  K.  KAMARAJ  REGARDING  COST  AND  TIME  OVERRUN  OF  HIGHWAY PROJECTS.

## Details of delayed projects

|   S No | State            |   Delayed Projects |
|--------|------------------|--------------------|
|      1 | A &NIsland       |                  2 |
|      2 | Andhra Pradesh   |                  1 |
|      3 | Assam            |                 11 |
|      4 | Bihar            |                  6 |
|      5 | Chhattisgarh     |                  2 |
|      6 | Goa              |                  3 |
|      7 | Gujarat          |                  4 |
|      8 | Haryana          |                  2 |
|      9 | Himachal Pradesh |                  5 |
|     10 | Jharkhand        |                  3 |
|     11 | Karnataka        |                  6 |
|     12 | Kerala           |                  4 |
|     13 | Madhya Pradesh   |                 12 |
|     14 | Maharastra       |                  6 |
|     15 | Manipur          |                  1 |
|     16 | Meghalaya        |                  4 |
|     17 | Mizoram          |                  5 |
|     18 | Orissa           |                 11 |
|     19 | Puduchery        |                  1 |
|     20 | Punjab           |                  9 |
|     21 | Rajasthan        |                 12 |
|     22 | Tamil Nadu       |                  3 |
|     23 | Telangana        |                  1 |
|     24 | Uttar Pradesh    |                  9 |
|     25 | Uttarakhand      |                 11 |
|     26 | West Bengal      |                  5 |
|     27 | LWE              |                 39 |
|     28 | NHDP-IV A        |                  9 |
|     29 | BRO              |                 61 |
|     30 | SARDP-NE         |                 37 |
|     31 | NHAI             |                112 |

*****