The National Highways Authority of India (NHAI) has set a reduced target of constructing 5,000 km of highways for the financial year 2024-25, marking a 22% decline from the previous year’s achievement of 6,444 km. This adjustment comes after NHAI surpassed its targets in the preceding fiscal year, underscoring a recalibration in project planning and execution.
Throughout April and May of the current fiscal year, NHAI has completed 762.3 km of highway construction, contributing to an overall total of 1,288 km for the period. This figure represents a slight decrease from the 1,465 km constructed during the same timeframe last year, attributed partly to operational slowdowns due to the model code of conduct being in effect. The decision to lower the construction target stems from several factors, including delays in project awards under the Bharatmala programme, following directives from the Finance Ministry to seek fresh approvals from the cabinet. This bureaucratic hurdle has temporarily halted new project awards, significantly impacting NHAI’s ability to initiate new developments. Despite these challenges, NHAI remains optimistic about future prospects, particularly with plans to attract private investment through the Build Operate Transfer (BoT-Toll) model. Valued at Rs 2.1 trillion, NHAI has identified 53 highway projects spanning approximately 5,214 km for private sector participation. Already, bids for eight highway stretches covering 297 km have been invited, signaling a proactive approach towards leveraging private capital for infrastructure development.
Analysts predict a modest growth of 5%-8% in road construction, reaching between 12,500 km to 13,000 km in FY25, supported by increased government capital outlay and sustained project momentum. Despite the slowdown in project awards observed in FY24, the Ministry of Road Transport and Highways (MoRTH) maintains a robust pipeline of over 45,000 km of projects, indicating a strong commitment to infrastructure expansion. In addition to NHAI, other arms of MoRTH, such as the National Highways & Infrastructure Development Corporation Ltd (NHIDCL) and the Road Wing, continue to play crucial roles in enhancing connectivity and infrastructure across strategic national and international corridors. The strategic adjustment in NHAI’s annual targets reflects a nuanced approach towards balancing fiscal discipline with sustained infrastructure growth, underscoring the complexities of managing India’s ambitious highway development agenda amidst evolving economic landscapes.
