The National Highways Authority of India (NHAI) has outlined its goal to construct highway spans of 5,060 km in this financial year, a significant increase from the record 4,882 km constructed in the preceding year.
The NHAI has also displayed its intent to surpass the previous year’s achievement of awarding highway projects spanning 6,003 km by setting its sight on 6,036 km for the fiscal year 2023-24. This comes off the back of the fiscal year 2022-23, where a flurry of 167 projects spanning a total of 5,213 km were launched.
In the first two months of the current fiscal NHAI has already made progress, building 655.31 km of highways and awarding a 22.42 km highway. Notably, capital expenditure by the NHAI for national highway infrastructure development hit a record high in FY23, standing at an impressive Rs 1.74 trillion, significantly overshooting the Rs 1.58 trillion allocated by the government.
Looking ahead, the Union budget for FY24 has earmarked Rs 1.62 trillion for the NHAI. The highway authority has further plans to raise between Rs 15,000 to Rs 20,000 crore via private financing through Special Purpose Vehicles for identified projects.
This year’s highway construction is likely to draw significantly more resources, aided by multiple financing models including the Hybrid Annuity Model (HAM), and Build Operate Transfer (BOT), apart from the traditional Engineering, Procurement, and Construction (EPC) method, where NHAI provides the full funding. EPC is projected to continue as the primary mode of highway construction this year as well, commanding a hefty 70-75 percent of total awards, as per the ICRA report.