In spite of a parliamentary panel’s scathing comments in regard to construction of roads and highways, the ministry of road transport and highways continues to be hamstrung by internal differences. The panel, in its report submitted in May this year, had pointed out how poor planning and execution had brought the pace down from 13.72 km per day in 2009-10 to 10.15 km per day in 2011-12 though there were no financial constraints.

But such is the infighting within the ministry – engineers and some officials on one side and the minister and his advisors on the other – nothing seems to be moving forward. In a latest case, the differences have led to a logjam over toll rate.

It started with a proposal to let the private partners in the PPP-mode projects to charge 1.5 times the normal toll rate for the Eastern Peripheral Highway, a bypass. The minister and his advisors wanted to allow a higher toll because the cost of a bypass is higher than the national highway. While re-carpeting and widening of an existing highway costs about Rs 7-8 crore a km, construction of a bypass costs more, about Rs 20 crore, because a completely new road has to be laid. But a section of the babudom opposed it and succeeded in blocking it.

In the latest instance, another proposal to give a higher weightage to inflation (on the basis of wholesale price index) in fixing the toll for the future projects – from existing 40 percent of inflation to 70 percent – is stuck. While the minister is keen to raise it, a section of the ministry is vehemently opposing it, resulting in another logjam.

The genesis of the problem, however, lies in the incumbent minister, CP Joshi’s initiatives that pulled back the national highway authority of India (NHAI), which is in charge of building and maintaining roads, from near bankruptcy. A planning commission issue paper, in 2010, had warned of an impending bankruptcy because of the ministry’s financial policies regarding the PPP projects, which were heavily tilted in favour of the private sector partners.

Introduction of open tenders (through e-tendering) dramatically increased the number of bidders who, because of competition, not only didn’t seek financial help of NHAI (called ‘viability gap funding’ or VGF) which was the norm during the days of Kamal Nath as minister, they even offered ‘premium’, thereby improving the financial health of NHAI.

But that apparently didn’t go down well with many with vested interest in favouring the private players at the cost of NHAI. Intense internal squabbling over toll issues has now slowed down the pace of highway building further.