Project: Feasibility cum PDR for 4/6-laning of Ambala to Kaithal section of NH-65

Final Feasibility Cum Preliminary Design Report : Chapter-1

CHAPTER -1: INTRODUCTION

1.1.

Vision of NHAI
To meet the nations need for the provision and maintenance of National Highways network to global standards
and to meet users expectations in the most time bound and cost effective manner, within the strategic policy
framework set by the Government of India and thus promote economic well being and quality of life of the
people.

1.2.

NHAIs Organisation and activities

The National Highways Authority of India was constituted by an act of Parliament, the National Highways
Authority of India Act,1988. It is responsible for the development, maintenance and management of National
Highways entrusted to it and for matters connected or incidental thereto.
National Highways Authority of India (NHAI) is mandated to implement National Highways Development Project
(NHDP) which is

India 's Largest ever highways project

World class roads with uninterrupted traffic flow

The National Highways have a total length of 70,548 km to serve as the arterial network of the country. The
development of National Highways is the responsibility of the Government of India. The Government of India
has launched major initiatives to upgrade and strengthen National Highways through various phases of
National Highways Development project (NHDP), which are briefly as under:
NHDP Phase I: NHDP Phase I was approved by Cabinet Committee on Economic Affairs (CCEA) in December
2000 at an estimated cost of Rs.30,000 crore comprises mostly of GQ (5,846 km) and NS-EW Corridor
(981km), port connectivity (356 km) and others (315 km).
NHDP Phase II: NHDP Phase II was approved by CCEA in December 2003 at an estimated cost of Rs.34,339
crore (2002 prices) comprises mostly NS-EW Corridor (6,161 km) and other National Highways of 486 km
length, the total length being 6,647 km. The total length of Phase II is 6,647 km.
NHDP Phase-III: Government approved on 5.3.2005 up gradation and 4 laning of 4,035 km of National
Highways on BOT basis at an estimated cost of Rs. 22,207 crore (2004 prices). Government approved in April
2007 up gradation and 4 laning at 8074 km at an estimated cost of Rs. 54,339 crore.
NHDP Phase V: CCEA has approved on 5.10.2006 six laning of 6,500 km of existing 4 lane highways under
NHDP Phase V (on DBFO basis). Six laning of 6,500 km includes 5,700 km of GQ and other stretches.
NHDP Phase VI: CCEA has approved on November 2006 for 1000 km of expressways at an estimated cost of
Rs. 16680 crore.
NHDP Phase VII: CCEA has approved on December 2007 for 700 km of Ring Roads, Bypasses and flyovers
and selected stretches at an estimated cost of Rs. 16680 crore .
1.3.

NHDP Program
National Highways Development Project is being implemented in 4 phases I, II ,III & V at present. The present
phases under Phase I, II & III envisages improving more than 32,754 km of arterial routes of NH Network to
international standards. The project-wise details NHDP Phase I, II, III and IV;

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Project: Feasibility cum PDR for 4/6-laning of Ambala to Kaithal section of NH-65
Final Feasibility Cum Preliminary Design Report : Chapter-1

Table 1.1 NHDP Status as on 30th November 2012.

NHDP
Port
Connectivity

Status as on 30th
November 2012

SARDP
-NE

NH - 34

Others

Total by
NHAI

NHDP Phase V

NHDP Phase
VII

NHDP
Total

14,799

6,500

700

47,096

380

388

5.5

1390

49,260

4,454

18

1,221

19

17,603

366

45

964

18,980

728

5,882

3,972

2,859

22

13,463

14

67

5.5

406

13,955.5

61

92

28

28

219

229

367

1,773

10,809

2,420

659

16,028

276

20

16,324

GQ

NS - EW
Ph. I & II

NHDP Phase
III

NHDP Phase
IV

Total Length
(Km.)

5,846

7,142

12,109

Already 4-Laned
(Km.)

5,844
(100.00%)

6,047

Under
Implementation (Km.)

Contracts Under
Implementation (No.)

Balance length for

award
(Km.)

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Project: Feasibility cum PDR for 4/6-laning of Ambala to Kaithal section of NH-65
Final Feasibility cum Preliminary Design Report : Chapter-1
NHDP's prime focus is on developing International standard roads with facilities for uninterrupted flow of traffic with:

Enhanced safety features

Better Riding Surface.

Better Road Geometry

Better Traffic Management and Noticeable Signage.

Divided carriageways and Service roads

Grade separators

Over bridges and Underpasses

Bypasses

Wayside amenities

Advantages of having a well developed network of world class highways are many for a nation like India -poised to surge
ahead

1.4.

Savings in vehicle operating costs

Faster, comfortable journeys

Reduced fuel consumption

Safer travel

Benefits to trade especially in movement of perishable materials

Reduced maintenance costs

Safer travel

All round development of areas

Project Financing and recovery mechanism

NHAI proposes to finance its projects by a host of financing mechanisms. Some of them are as follows :Through budgetary allocations from the Government of India : Cess
In a historic decision, the Government of India introduced a Cess on both Petrol and Diesel. This amount at that time (at
1999 prices) came to a total of approximately Rs. 2,000 crores per annum. Further, Parliament decreed that the fund so
collected were to be put aside in a Central Road Fund (CRF) for exclusive utilization for the development of a modern
road network. The developmental work that it could be tapped to fund, and the agencies to which it was available were
clearly defined as:

Construction and Maintenance of State Highways by State Governments.

Development of Rural Roads by State Governments

Construction of Rail over- bridges by Indian Railways

Construction and Maintenance of National Highways by NHDP and Ministry of Road Transport & Highways

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Project: Feasibility cum PDR for 4/6-laning of Ambala to Kaithal section of NH-65
Final Feasibility cum Preliminary Design Report : Chapter-1
Today, The Cess contributes between Rs 5 to 6 Thousands crores per annum towards NHDP.
Loan assistance from international funding agencies.
Loan assistance is available from multilateral development agencies like Asian Development Bank and World Bank or
Other overseas lending agencies like Japanese Bank of International Co Operation
Market borrowing.
NHAI proposes to tap the market by securities cess receipts
Private sector participation.
Major policy initiatives have been taken by the Government to attract foreign as well as domestic private investments. To
promote involvement of the private sector in construction and maintenance of National Highways, Some Projects are
offered on Build Operate and Transfer (BOT) basis to private agencies. After the concession period, which can range up to
30 years, this road is to be transferred back to NHAI by the Concessionaries.
NHAI funds are also leveraged by the setting up of Special Purpose Vehicles (SPVs).The SPVs will be borrowing funds
and repaying these through toll revenues in the future. This model will also be tried in some other projects. Some more
models may emerge in the near future for better leveraging of funds available with NHAI such as Annuity, which is a
variant of BOT model.
Policy Initiatives for Attracting Private Investment

Government will carry out all preparatory work including land acquisition and utility removal. Right of way (ROW) to be
made available to concessionaires free from all encumbrances.

NHAI / GOI to provide capital grant up to 40% of project cost to enhance viability on a case to case basis

100% tax exemption for 5 years and 30% relief for next 5 years, which may be availed of in 20 years.

Concession period allowed up to 30 years

Arbitration and Conciliation Act 1996 based on UNICITRAL provisions.

In BOT projects entrepreneur are allowed to collect and retain tolls

Duty free import of specified modern high capacity equipment for highway construction.

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