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Larrdis (Lok Sabha Secretariat) New Delhi: "Road Transport and Highways"
Larrdis (Lok Sabha Secretariat) New Delhi: "Road Transport and Highways"
Larrdis (Lok Sabha Secretariat) New Delhi: "Road Transport and Highways"
March 2022
LARRDIS
(Lok Sabha Secretariat)
New Delhi
BACKGROUND NOTE
on
March 2022
The note is intended to serve only as a background aid to the Members of Parliament. It is
for restricted circulation and not for publication in any form.
Introduction
Road Transport is a critical component of the infrastructure required for the
economic development of a country. As per the National Transport Development
Policy Committee Report of 2011-12, its impact on the pace, structure and pattern
of development can be gauged by the fact that road transport is estimated to handle
90 percent and 69 percent of the country-wide passenger and freight traffic,
respectively. High growth and proper maintenance of the road network in India is
a significant pre- requisite for the aspiration of the country to become a $5 trillion
economy by 2024-25.
Ministry of Road Transport and Highways (MoRTH) was formed in 2009
by bifurcating the erstwhile Ministry of Shipping, Road Transport and Highways
into two independent Ministries, i.e., the Ministry of Road Transport & Highways,
and the Ministry of Shipping. The Ministry Road Transport & Highways has two
wings: Roads wing and Transport wing.
MoRTH shoulders the responsibilities and tasks pertaining to, inter alia,
construction and maintenance of National Highways (NHs); administration of the
National Highways Act,1956; National Highways Authority of India Act, 1988;
National Highways Fee (Determination of Rates and Collection) Rules, 2008;
Motor Vehicles Act, 1988; and Central Motor Vehicles Rules, 1989, as also
formulation of broad policies relating to road transport and automotive norms,
besides making arrangements for movement of vehicular traffic with neighbouring
countries.
India has the second largest road network in the world. With 63.86 lakh kms of
rural-urban roads and national and state highways, India is next only to the United
States of America that has a road network of 66.45 lakh kms. This comprises
National Highways, Expressways, State Highways, Major District Roads, Other
District Roads and Village Roads. With the proactive policy initiatives in the sector,
the road network has continuously been expanding in the country.1 The road network
is, also well integrated with the multi-modal system of transportation that provides
crucial links with airports, railway stations, ports, and other logistical hubs. Road
transport is the dominant mode of transportation in India.
1
https://www.indiabudget.gov.in/economicsurvey/doc/echapter_vol2.pdf (Page No. 289)
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A strong emphasis on road connectivity was laid during the NDA regime in
1999 with the concept of Golden Quadrilateral Highway project linking four major
cities: Delhi, Mumbai, Chennai and Kolkata. With the Golden Quadrilateral
project centered to enhance the National Highway network, the Pradhan Mantri
Gram Sadak Yojana strengthened the rural road connectivity and linked it to the
highways. To give further impetus to the road infrastructure, the government came
up with the Bharatmala Pariyojana Scheme in 2017. Under this scheme, 34,800
km of highways would be constructed at the cost of Rs 5.35 lakh crore. This
includes:
Sl. No. Length (in Kms.) Roads
1. 10,000 National Highway Development
Programme
2. 9,000 Economic Corridors
3. 6,000 Inter-Corridor and Feeder Routes
4. 5,000 National Corridor Efficiency
Programme (to be upgraded)
5. 2,000 Coastal and Port Connectivity Roads
6. 2,000 Border and International Connectivity
roads
7. 800 Greenfield Expressways
Total 34,800 Kms.
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Budget allocation for the Ministry of Road Transport and Highways (in Rs crore)
% Change (2022 BE
2020-21 Actual 2021-22 RE 2022-23 BE
over 2021 RE)
Recoveries -376 0 0 0
NHAI: The central government develops and maintains NHs through the NHAI. In
2022-23, NHAI has been allocated Rs 1,34,015 crore, which is 106% more than the
revised estimate of 2020-21. Of the budgeted amount, 75% (Rs 1,00,100 crore) will
be provided from the Central Road and Infrastructure Fund, 15% (Rs 20,000 crore)
will come from the monetisation of the National Highways, and the remaining 10%
(Rs 13,915 crore) will be provided from the Permanent Bridge Fees Fund.
The allocation towards NHAI has more than tripled from 2019-20 (budget estimates)
to 2022-23 (revised estimates). In 2020-21, the actual expenditure exceeded the
budget estimates by 8%. In 2021-22, the revised estimates are again expected to
exceed the budget estimates by 8%. In 2019-20, the actual expenditure fell short of
the budgeted estimate by 14%.
This scheme seeks to optimise the efficiency of freight and passenger movement as
well as to increase the number of districts with NH linkages from 300 to
550. Under Phase I of Bharatmala Pariyojana, 34,800 km of roads will be developed
over a period of five years (2017-18 to 2021-22). Phase I will also subsume 10,000
km of balance roadworks under the National Highway Development Programme. The
estimated cost of Phase I is Rs 5,35,000 crore, spread over five years.
As of December 2021, road projects with an aggregate length of 19,926 km, and
costing Rs 5.98 lakh crore have been approved under Bharatmala Pariyojana Phase-I.
Of this, road length of 6,976 km has already been completed. This corresponds to 35%
of the approved project length.
Roads and bridges: Expenditure under roads and bridges includes development of
NHs, projects related to expressways, increasing the number of lanes under various
projects, and development of road connectivity in left-wing extremism affected areas.
In 2022-23, the allocation towards roads and bridges is Rs 64,573 crore. This is a
decrease of 2% over the revised estimates of 2021-22.
Funds managed by the Ministry
The Ministry manages its expenditure through various funds. Their details are
provided below.
Central Road and Infrastructure Fund (CRIF): A majority of the Ministry’s
expenditure is managed through transfers from the CRIF. A portion of the cess
collected on motor spirit and high-speed diesel is earmarked for the development of
NHs and SHs, and the amount is transferred to the non-lapsable CRIF. This amount is
eventually released to the NHAI, and to the state/UT governments for the development
of road infrastructure, and other projects (such as ports, railway track, airports) in the
country.
For 2022-23, the transfer from CRIF towards the Ministry is estimated at Rs 1,59,616
crore. This is 61% more than the revised transfer in 2021-22 (Rs 99,239 crore).
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Permanent Bridge Fees Fund (PBFF): Funds transferred to the PBFF relate to the
revenue collected by the government through: (i) fees levied for the use of certain
permanent bridges on NHs by motor vehicles, (ii) toll on NHs, and (iii) revenue share
received on some PPP projects. These funds are then released to the NHAI for the
development of NHs entrusted to it.
For 2022-23, the transfer from PBFF is estimated at Rs 13,921 crore. This is a 10%
increase from the transfer in 2021-22 at the revised estimates stage (Rs 12,670 crore).
National Investment Fund (NIF): The NIF was created in 2005, and is credited with
proceeds from disinvestments of public sector enterprises. The Ministry finances
the Special Accelerated Road Development Programme in North East (SARDP-NE)
with funds from the NIF.
For 2022-23, the transfer from NIF is estimated at Rs 10,565 crore. This is an 25%
increase from the transfer in 2021-22 (Rs 8,430 crore) at the revised estimates stage.
National Highways Fund (NHF): In August 2016, the Union Cabinet had authorised
NHAI to monetise certain public funded NH projects. Such monetisation includes
transferring operations and maintenance of stretches of NHs to private contractors on a
long-term basis. In 2022-23, Rs 20,000 crore is estimated to be generated through
such monetisation. This is a 54% annual increase from the monetisation amount in
2021-22 (Rs 13,000 crore) at the revised stage.
Road Network2:
The National Highways have a total length of 1,40,995 km, which in totality serve as the
arterial network of the country. The Government of India had launched major initiatives
to upgrade and strengthen National Highways through various phases of the National
Highways Development Project (NHDP). The status of various programmes, up to
31.12.2021 are as under:
al
Balance road works 10,000 1,782 462 2,244
under NHDP
Grand Total 34,800 5,268 1,728 6,996
B. Other Schemes
SARDP-NE
(Phase 6,418 3,828 293 4,121
A+Arunachal
Pradesh)
LWE 6,085 5,704 37 5,741
(including Vijayawada
Ranchi
Route)
EAP
(WB+JICA+ADB) 2,855 1,280 126 1,406
Overall road projects exceeding 64,000 km in length, costing more than Rs. 11
lakh crore, are in progress out of which work in respect of projects of more than
40,000 km length has been completed and in balance length of more than 24,000 km
works are in progress. National Highways of 5,835 km length have been constructed
in the first nine months of FY 2021-22.
The Ministry completed all ongoing projects that had been awarded upto
2015-16 and placed the highest ever target of construction of 11,000 kms of
National Highways in 2020-21 as against 10,237 kms achieved during 2019-20.
2. https://morth.nic.in/sites/default/files/Annual%20Report_21-22-1.pdf
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Challenges
The delay in the construction has led to a large gap between the budget allocation
and actual expenditure on the road construction in the country. The need of the
hour is to find an early solution to ensure timely completion of the road
construction projects. Increasing Congestion and number of private vehicles daily
added to Indian roads adds to already over-burdened roads and transport system in
India.
The reasons for the non-achievement of target are mainly due to delay in Land
Acquisition Clearance, Forest Clearance, Wild Life Clearance, Utility Shifting
Clearance, Geography Constrains & Soil conditions, delay in work by contractor
due to cash flow problems, law & order issues, limited working season etc. While
conceptualizing Bharatmala Pariyojana, it was observed that even on the already
developed corridors such as the Golden Quadrilateral and North-South, East- West
corridors, and other high-density Economic Corridors, there are multiple points of
local congestion hampering the speed of vehicular movement on this corridor.
1. Project delay
The Committee on Public Undertakings (2017) had noted that from 1995, till June
2016, out of the total 388 projects completed, only 55 projects were completed on or
before time. Delays in the completion of the projects were mainly attributed to: (i)
the long time taken in land acquisition, and obtaining environment and forest
clearances, (ii) poor performance of concessionaires due to economic slowdown, (iii)
cash flow problems, and (iv) law and order issues. Recently projects have also been
halted due to NCLT proceedings against the developer. Such delays increase project
costs, eventually making certain projects unviable. As of December 2021, the
cumulative cost overrun of projects in the road sector is estimated to be greater than
Rs 8,120 crore.
2. Land acquisition
From January 1, 2015, the compensation for land acquired by NHAI is determined
as per the Right to Fair Compensation and Transparency in Land Acquisition
Rehabilitation and Resettlement Act, 2013. The Committee on Public Undertakings
(2017) had noted that due to higher compensation under the 2013 Act, the
expenditure by the Ministry of Road Transport on land acquisition increased from Rs
9,097 crore in 2014-15 to Rs 21,933 crore in 2015-16.30 In 2017-18, NHAI spent
more funds on land acquisition (41% of the expenses) as compared to project
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expenditure (39%).10 The Standing Committee on Transport (2020) noted that the
average rate of land acquisition has increased significantly from about Rs 0.92 crore
per hectare in 2013-14 to Rs 3.13 crore per hectare (ha) in 2019- 20 (an increase of
240%).
In October 2021, the central government issued new guidelines for public
procurement and project management. Most government procurement for public
works (such as construction of highways and buildings) uses the L1 system (least
cost). The Economic Survey (2021) notes that the L1 system may not be appropriate
for complex projects needing innovation, quality, speed, and functionality. The
revised guidelines allow the use of quality-cum-cost based system for selecting
bidders. The new guidelines also stipulate timely release of 75% or more of bills,
raised within 10 working days of the submission of the bill. This will help reduce
delays in project execution, cost overruns, and disputes
3. Road Safety
In 2022-23, the Ministry has allocated Rs 356 crore towards road transport and
safety. This is a 56% increase over the revised expenditure on maintenance in 2021-
22. Between 2017-18 and 2020-21, the actual expenditure on safety has not
exceeded 61% of the budget estimates. The allocation towards safety provides for
various things such as road safety programmes, setting up of facilities on NHs,
extending relief to accident victims, strengthening of public transport, research and
development, and training.
4. Connectivity to remote areas
The Ministry also allocates funds towards the development of highways in areas
with poor connectivity. Some of these projects include the Special Accelerated
Road Development Programme in North East (SARDP-NE), Externally Aided
Projects and Roads Projects in Left-Wing Extremism Affected Areas. In 2022-23,
Rs 10,565 crore has been allocated towards the SARDP-NE project. This is a 25%
annual increase from the revised expenditure in 2021-22. Between 2017-18 and
2019-20, the fund utilisation of the project has been consistently greater than 90%.
In 2020-21, the actual expenditure exceeded the budgeted expenditure by 17%.
Way Forward
Congestion is primarily driven by interaction of local city traffic with
through highway traffic. These congestion points could be addressed by separating
the city traffic from the highway traffic through development of grade separators,
city bypasses, ring roads and lane expansion etc. 191 points of local congestion
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References:
https://morth.nic.in/sites/default/files/Annual%20Report%20-
%202021%20(English)_compressed.pdf
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Annexure:1
STATUS OF IMPLEMENTATION OF VARIOUS IN ROADS SECTOR PROJECTS
Developing 3,500 km of NHs in Tamil Project length of 125 km is completed, and 2,214 km is
Nadu ongoing.
Delhi-Mumbai Expressway: 260 km will Out of the total length of 1,380 km, 1,337 km length
be awarded has been awarded
before 31.3.2021. for construction. Of this, 450 km has been completed,
and 887 km is under construction.
Delhi – Dehradun economic As on date, out of the 329 km complete length of the
corridor: 210 km corridor will be corridor, 220 km has been awarded for construction.
initiated in the current financial year.
Construction will begin in 2021-22
Kanpur – Lucknow Expressway: 63 Bids for the Kanpur –Lucknow Expressway have been
km expressway will be initiated in 2021- invited and in advanced stage of land acquisition.
22.
Chennai – Salem corridor: 277 km The flagship 277 km Chennai Salem corridor is in pre-
expressway will be awarded, and construction stage with studies undertaken like Social
construction would start in 2021-22. Impact Assessment (SIA) to analyse and create proper
alternatives as per guidelines of the Supreme Court.
Raipur – Vishakhapatnam: 464 km Out of the total corridor length of 464 km, projects
will be awarded in the current year. have already been awarded for 356 km.
Construction will start in 2021-22.
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Amritsar – Jamnagar: Construction As on date, over 260 km of the corridor has already
will commence in 2021-22. been constructed. The complete greenfield section of
762 km from Sangriya to Santalpur and 63 km
brownfield section from Bhatinda to Sangriya have
been awarded.
Delhi – Katra: Construction will Out of a total corridor length of 670 km, 580 km has
commence in 2021-22. been awarded. The remaining stretches to be awarded
in FY 2021-22.
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