NHAI Projects : Current Status
NHDP & Other NHAI Projects
(Status : 30th April , 2005)
Others
Total by
NHAI
356
777
14,313
707
69
287
5,840
1,069
1373**
280
166
2,888
60
27
7
4
96
-
5,194
7
358
5,559
GQ
NS - EW
Total Length (Km.)
5,846
7,300*
Already 4-Laned(Km.)
4,777
Under Implementation
(Km.)
Contracts Under
Implementation
(No.)
Balance length for
award (Km.)
Port
Conne
ctivity
Policy Initiatives
 Foreign investment up to 100% allowed through automatic route.
 Private investment through BOT / Annuity Scheme.
 Viability Gap Funding.
 Duty free import of high capacity sophisticated equipment
 Land is to be acquired by the Government and given free of charge to
private sector, for further development of highways.
the
 Highways related facilities such as Restaurants, Motels, Parking areas, etc.
are allowed to be set up by the entrepreneur.
 Tax Holiday - A block of 10 years to be selected out of first 20 years.
Road Project Development
Process
Pre-Feasibility
Detailed Project
Report (DPR)
Construction
Supervision
Independent
Consultant
Maintenance or O&M Consultant
Typically adopted by NHAI
and some larger stretches
of critical State Highways
Pre-Feasibility Studies
• Not undertaken often
• Usually for a network (eg., NH 1)
• BOT Projects – bid out based on the Pre-Feasibility study
• Preliminary assessment of
– Macro-economic developments
– Traffic – current and projections
– Road survey – Quality of existing road
– Strengthening & widening – identification of stretches
– Preliminary Cost estimation
• Typical fees paid for a network of about 1000 kms – 200,000
to 300,000 Euros
Detailed Project Report
• Undertaken for each stretch
• Detailed report on
– Traffic Survey
– Design & Detailed engineering
– Finalisation of BoQ
– Detailed project costing
– Maintenance norms / specifications
• Typical fees paid for DPR:
– NHAI : 2500 – 3000 Euros per km (North East – 4000)
– State Highways : 800 – 1000 Euros per km (Funded)
: 300 – 400 Euros per km (PWD)
Construction Supervision
• On behalf of NHAI
• Typically, for the entire duration of construction
• Supervision of
– Adherence to engineering specifications
– Quality monitoring
– Monitoring of completion timing
• Typical fees paid for Construction Supervision:
2- 2.5% of project cost
Independent Consultant
• Independent monitoring of
– Adherence specifications
– Quality monitoring
– Monitoring of completion timing
• Independent point of view in case of disputes
• Method of selection : NHAI & BOT Operator; costs
shared
• Typical fees paid to Independent Consultant: 1% of
project cost
Road Project Development
Process
Fees for an average 100 km Road Project
Pre-Feasibility
Construction (incl Pre) Engineering
Consultancy : 1 mn Euros (for NHAI Project)
: 0.45 mn Euros for BOT project
Detailed Project
Report (DPR)
Construction
Supervision
2-2.5% of project cost
NHAI : 2500 – 3000 Euros per km
State Highways : 800 – 1000 Euros per km
(funded); 300 – 400 Euros per km
Independent
Consultant
About 1% of project cost
Maintenance or O&M Consultant
0.6% - 0.8% of project cost for 24
months
Engineering Manpower Rates
• Key Professional (Engineer with 15-20 yrs work exp.):
3000 Euros per man-month
• International Consultant : 12000 Euros per man-month
• Sub-Professionals (Engineer with about 10 yrs work
exp.) : 1000 Euros per man month
Construction Contracts
• NHAI Pre-Qualified firms (P 500, P300, P200)
• NHAI Construction contracts
–
–
–
–
–
Payment risk – low
Highly competitive – many players; consortia
Bonus & Penalty clauses
Typically, Procurement & Construction contracts
Lowest fixed price – selection criteria
• State Govt. PWD Road Construction Contracts
–
–
–
–
–
–
Payment risk – low (if multilaterally funded); else, medium-high
Unless funded, PQ criteria allows many parties to bid
Usually lower specifications; lower prices
Design changes
Bid process transparency (?)
Lowest fixed price – selection criteria
Construction Contracts
• Competitiveness
– Information sourcing – extent; quality; timing
– Engineering – Methodologies; Design of enabling
structures
– Quarrying & Mining – identification & sourcing (pre-bid)
– Procurement
– Site related – project management
– Adaptability to local conditions (Mobilisation lead time)
– Equipment availability & costing
– Handling “sub-contractors”
BOT Concessions
• Pre-Qualification – Technical (credentials) & assessment
of Financial wherewithal to do the project
• Issue RFP to pre-qualified bidders
• Site visits; Pre-bid meetings; Issue of clarifications
• Submission of technical & financial bids
BOT Concessions
• Pre-specified concession period
• Bid on “Grant” required from NHAI (Typically Cap of 25% of
NHAI estimated project cost)
• Minimum Grant bid wins the project (Negative Grant bids
common)
• Traffic; Construction and O&M risk - concessionaires
• Toll risk (Collection risk) – very low; Local Govt. support
• Toll rates – pre-specified, per PCU rate (with inflation built in)
• Construction supervision engineer – appointed by NHAI;
selected jointly
• Independent engineer – monitor O&M through the concession
period;
• Typical Financial structure : 70:30 (Debt : Equity)
• Increasingly, Project finance structures are being offered
Annuity Contracts
• Contractor to Design & Construct the road; maintain it for the
concession period (usually 2.5+15 years)
• Contractor to mobilise the finances
• NHAI to pay contractor a bid for (fixed) “Annuity”, every six
months, after construction (till the end of the contract)
• Minimum Annuity bid wins the contract
• Traffic risk – borne by NHAI
• Contract includes toll collection (NHAI’s risk)
• O&M to be undertaken by the contractor
• Construction supervision engineer and Independent engineer
to monitor contractor