NHAI Bharatmala project | debts | construction phase 1 | phase 1 | phase 2 | funding | land acquisition issues | ECs | latest news
Bharatmala project: What is it all about? This article will discuss the NHAI’s debt, how much money the project will cost, and how the first phase of the project will be built. It will also discuss whether this project is worth the money.
You should know the details before you start your construction. It is important to know that the first phase will only take two years to complete, and is the largest project of this kind in India.
NHAI bharatmala project
NHAI has announced a massive infrastructure development project in India. The project will provide 50 national corridors for road transport. It is estimated that 70 to 80 percent of freight traffic will move along these corridors.
The project will also help in decongesting choke points in the National Corridor. It will connect 550 districts of the country. Currently, only 300 districts have interlinked national highways.
NHAI is targeting to award about 10,000 km of road work in FY 2022-23. It expects to complete all sections by FY 2024. As of December 2020, only 5,000 km of project execution was completed, but there are plans for another 2,500 kilometers of projects.
The NHDP is the biggest infrastructure project in India. It will connect over 500 cities. However, the NHAI is facing delays because of delayed land acquisition.
According to the Bharatmala project’s complete details, a total of 34,600 km of new and rehabilitated roads will be constructed by December 2022.
This project, which was previously called the National Highways Development Program (NHDP), will help to reduce logistics costs in India. The Raipur-Visakhapatnam Economic Corridor will improve connectivity in the region and support economic growth.
The project will create jobs and increase the country’s LPI, a benchmarking tool for countries. It is expected to create plenty of direct and indirect jobs and promote economic activities across the nation.
The Bharatmala project will also improve LPI, a benchmarking tool used by countries to determine how well they perform in various areas. This project is an impressive project and will help the country achieve more.
NHAI’s debt
The government has been aggressive in expanding the highway network in the country, but the budgetary allocation has not kept pace with the ambitious Bharatmala program.
In fact, the allocation for the NHAI was increased to Rs 37,320 crore last year, but by March this year, there was a 1.6% reduction. Moreover, toll revenue has not covered CAPEX, and the cost of land acquisition has skyrocketed.
The NHAI’s debt on the Bharatmala project is growing, despite its excellent financial performance and AAA credit rating. The private developers take over highway projects on concession and recover their investment from toll collection.
But NHAI is running the risk of getting into a debt trap. In order to avoid this, the government is focusing on finding alternative sources of funding to meet the debt repayments.
The NHAI has borrowed more than Rs 6,000 crore from various sources, including the Employees Provident Fund, Life Insurance Fund, and rupee-denominated masala bonds. NHAI plans to issue Bharatmala bonds as a way to raise funds.
Meanwhile, it is looking at a private placement of long-term bonds and a public-private partnership to raise funds. The government has also asked the NHAI to develop 34800 kilometers of highways.
According to a recent report by the Parliamentary Standing Committee, the NHAI has a debt of more than Rs 3 trillion in the next five years. However, the central government wants to ensure that the debt burden on the highway developer does not reach unmanageable levels.
The agency has grown its debt by 14 times since 2014-15, and it reached a staggering 3.44 trillion in January. It hopes to reduce this debt burden to a trillion rupees by 2024-25.
Related: Online Land Records in Chhattisgarh
Construction of phase 1
The Bharatmala project is a mega infrastructure development project in the country. It is expected to cover 24,800 kilometers, with the first phase of construction likely to begin by the end of 2018.
The project consists of several road schemes, including economic corridors, feeder roads, border connectivity roads, expressways, and 10,000 kilometers of National Highways Development Project roads. The first phase of Bharatmala was expected to be completed by 2022.
The Bharatmala Pariyojana is funded by various means. Budgetary allocation, private investment, debt funds, and toll-operator transfer are some of the methods.
The Bharatmala Pariyojana project is being implemented by the National Highways Authority of India (NHAI) and the National Highway and Industrial Development Corporation.
In addition to developing a national highway network, the project also includes the development of feeder and inter-corridor roads, as well as coastal connectivity routes.
The Bharatmala project is the biggest road project in India. The scheme is expected to double freight traffic to the National Highways. It will connect 24 logistics parks, 66 inter-corridors, 116 feeder roads, and seven northeast multi-modal waterway ports.
The project also covers the flagship National Highway Development Project (NHDP) which was first announced by the Atal Bihar Vajpayee government in 1998.
Bharatmala Pariyojana will focus on upgrading the country’s high-volume corridors, constructing bypasses, and elevating the national highways.
The project is expected to decongest power-packed corridors, and will also create logistics parks along these improved corridors. In addition, the Bharatmala project includes plans for coastal road connectivity and ports.
Phase 1 of the Bharatmala Project
The Government of India approved Phase-I of the Bharatmala project in October 2017, with an estimated cost of Rs. 10,000 crores. Nitin Gadkari, the minister of road development, said the project is now being funded by the overseas market and capital markets.
But costs have already soared and the project is now well behind its 2022 completion date. To complete phase I of the Bharatmala project, the government has to construct around 26.666 km of expressway road in a period of nine months.
In October 2017, the Cabinet Committee on Economic Affairs approved the first phase of the Bharatmala Pariyojana, which involves developing 34,800 kilometers of road and 571 km of infrastructure projects covering an area of 19,785 square miles.
This phase is projected to cost Rs. 593,820 crores and will require a workforce of more than 400,000. Among other things, the project will result in more than 14.2 million man-days of work.
The Bharatmala Project is an ambitious highway expansion initiative aimed at improving connectivity across the country. This initiative has been named India’s second-largest highway development project and aims to create a reliable high-speed road network across the country.
When complete, the project is expected to reduce travel time for cargo and facilitate international trade. It will cost approximately $100 billion to build phase I of the Bharatmala project.
The Bharatmala Phase-1 construction is scheduled to finish in 2023-24. It consists of 20411 Km of awarded stretch. When completed, this project will reduce logistics costs in India.
Another important component of the Bharatmala project is the Raipur-Visakhapatnam Economic Corridor in Odisha. Both of these projects will enhance connectivity and promote economic growth in the region.
Related: Assam Land Records: Dharitree Insights
Phase 2 of the Bharatmala Project
After the completion of Phase 1 in December 2022, the Union Government is keen to start Phase 2 in the year 2024. In this phase, the entire focus of the project will be on the interconnectivity of the multimodal logistics parks and ensuring synergy with the inland waterways of India.
Funding of the Bharatmala Project
The funding of the Bharatmala project is done using many routes by the government of India and the highway authority of India. Four different routes for funding the project are:-
- Market borrowings
- Central road fund
- Monetizing government-owned road assets
- Budgetary allocation
Land acquisition issues
Despite the BJP’s assurances, the farmers’ delegation in Bharatmala protested peacefully and democratically for months. The Congress government did not take the farmers’ demands seriously and ignored their demands.
The Governor should ask the government to come up with a uniform land acquisition policy to ensure the interests of farmers are protected. It needs a pro-farmers uniform land acquisition policy to prevent such a situation from recurring in the future.
A good example of this is the S. Parkash Singh Badal-led government that complied with this policy. In this way, the farmers’ demand for compensation was met and the government was able to acquire their land with market price and multiplier factor.
The Bharatmala project is currently being implemented in Gujarat, Rajasthan, Himachal Pradesh, Uttarakhand, Sikkim, and Uttar Pradesh. The road network will extend across the north-eastern states and start from Gujarat.
Once the project is completed, it will cover 65,000 km of national highways and connect to the rest of India. However, the project is not without its challenges.
Highway Construction
The construction of highways has been a priority for the Modi government since 2014. The major roadblock to the national highway building program is land acquisition.
The estimated cost is over INR 10 lakh crore due to rising land acquisition costs. Nitin Gadkari has confirmed that the total cost of the project could rise to ten lakh crore.
The Bharatmala project has ample opportunities for investors. But it depends on timely land acquisition and proper funding.
NHAI, the Ministry of Road Transport and Highways, and the State Public Works Departments will implement Bharatmala in the engineering, procurement, and construction mode. The National Highways & Infrastructure Development Corporation will also speed up the project’s execution.
It will cover over 10,000 km of road work pending under the National Highways and Development Plan.
Economic Corridors Under Bharatmala Project
In addition to the National Corridors, the Bharatmala project has identified key ‘Economic Corridors’. 9000 km out of the identified 26,200 Km falls under Phase 1 of the Bharatmala project. The ‘Economic Corridors’ will exclude the National Corridors.
In addition to the ECs, phase 1 will take up 66 inter corridors (8000 Km) and 116 Feeder Routes (7,500 Km).
The following Economic Corridors (ECS) under Bharatmala Project:
| EC Route | Name of the Economic Corridor | EC Route | Name of the Economic Corridor |
| EC 1 | Mumbai-Kolkata | EC 23 | Hyderabad-Aurangabad |
| EC 2 | Mumbai-Kanyakumari | EC 24 | Delhi-Kanpur |
| EC 3 | Amritsar-Jamnagar | EC 25 | Tharad-Phalodi |
| EC 4 | Kandla-Sagar | EC 26 | Nagaur-Mandi Dabwali |
| EC 5 | Agra-Mumbai | EC 27 | Sagar-Lucknow |
| EC 6 | Pune-Vijayawada | EC 28 | Sambalpur-Paradeep |
| EC 7 | Raipur-Dhanbad | EC 29 | Amreli-Vadodara |
| EC 8 | Ludhiana-Ajmer | EC 30 | Godhra-Khargone |
| EC 9 | Surat-Nagpur | EC 31 | Sambalpur-Ranchi |
| EC 10 | Hyderabad-Panaji | EC 32 | Bengaluru-Malappuram |
| EC 11 | Jaipur-Indore | EC 33 | Raisen-Pathariya |
| EC 12 | Solapur-Nagpur | EC 34 | Bengaluru-Mangaluru |
| EC 13 | Sagar-Varanasi | EC 35 | Chittaurgarh-Indore |
| EC 14 | Kharagpur-Siliguri | EC 36 | Bilaspur-New Delhi |
| EC 15 | Raipur-Visakhapatnam | EC 37 | Solapur-Mahabubnagar |
| EC 16 | Delhi-Lucknow | EC 38 | Bengaluru-Nellore |
| EC 17 | Chennai-Kurnool | EC 39 | Ajmer-Udaipur |
| EC 18 | Indore-Nagpur | EC 40 | Sirsa-Delhi |
| EC 19 | Chennai-Madurai | EC 41 | Sirohi-Beawar |
| EC 20 | Mangalore-Raichur | EC 42 | Jaipur-Agra |
| EC 21 | Tuticorin-Cochin | EC 43 | Pune-Aurangabad |
| EC 22 | Solapur-Bellary-Gooty | EC 44 | NorthEast Corridor |
Latest News on Bharatmala Project
April 22, 2022: Speaking on the occasion of National Road Infra Conclave 2022, the Chief of the National Highway Authority of India has said that all works under the Rs 5.35 trillion Bharatmala project phase 1 will be awarded by 2023-24.
Out of the 20411 Km awarded, 8134 Km stretch is already constructed. He expressed that the Bharatmala project, once complete, will significantly reduce the logistics cost in India.
April 20, 2022: The construction of the six-lane Raipur-Visakhapatnam Economic Corridor is in full swing in Nabrangpur, Odisha. This 124 km stretch will improve the connectivity and aid in the economic growth of the region.
Conclusively, the Bharatmala project aims for the development and improvement of the highway network across India and to connect the economic corridors with logistic parks and growth centers.
Once complete, the Bharatmala project will significantly reduce the freight logistics cost and reduce the travel time drastically.