Bharatmala Project Cost Shoots to Estimated INR 10 Lakh Crore, Confirms Nitin Gadkari 65,000 km highways to be constructed under the project by 2022

By Aastha Singal

You're reading Entrepreneur India, an international franchise of Entrepreneur Media.

Wikipedia Commns

The construction of highways has been among the major agendas of Modi-government since 2014. However, land acquisition has emerged as the biggest roadblock for the national highways building program, Bharatmala Pariyojana, which comprises the construction of 65,000 km of highways under its umbrella by 2022.

The Skyrocketing Costs

The project earlier estimated at over INR 5.35 lakh crore would now cost over INR 10 lakh crore due to the heightened charges for acquiring the land, confirmed the minister of road transport and highways Nitin Gadkari. "The total project costing is going up to INR 10 lakh crore," he shared during the question hour in the Rajya Sabha on June 24.

Apparently, Bharatmala has not been allotted a single penny by the finance ministry. Hence, "We are raising money from the market," Gadkari stated. For obtaining money from the capital market, the ministry is making TOT (Toll-Operate-Transfer) model. "We are capitalizing the projects and we are raising funds from the overseas market," he added.

Land Acquisition – The Biggest Roadblock

Citing land acquisition as the main problem in delay of projects, Gadkari expressed that the cost was very high in some states. He assured that some state governments are coming forward to lend a hand to the ministry in easing land acquisition process and bearing its cost, which is helping in early implementation of projects. Moreover, "No project is being awarded without confirming the availability of 80per cent land," he added.

Sharing an anecdote, Gadkari stated that the Uttar Pradesh state government has taken responsibility for giving 50 per cent of the cost for the ring road. "Land acquisition is so much that it is very difficult for the government to bear the cost," he stressed. On the contrary, Kerala would be a serious problem due to skyrocketing land acquisition costs.

The Government's Achievements

Gadkari stressed that projects are not delayed because of land acquisition anymore and the maximum problem in construction is related to DPR (detailed project report). "There were 403 projects pending when Narendra Modi came to power involving a cost of INR 3,85,000 crore," Gadkari boasted calling it a great achievement of Indian government.

"We saved bankers of INR 3 lakh crore of NPAs and now 90 percent of projects are moving fast," he further shared. The first phase of the Bharatmala program approved in 2017 includes construction of 24,800 km of national highways, in addition to 10,000 km of balance road works under the national highways development program. "I am happy to inform that projects of 8,000 kms have already been awarded," Gadkari shared.

Aastha Singal

Entrepreneur Staff

Former Features Writer

A business journalist looking to find happiness in the world of startups, investments, MSMEs and more. Officially started her career as a news reporter for News World India, Aastha had short stints with NDTV and NewsX. A true optimist seeking to make a difference, she is a comic junkie who'd rather watch a typical Bollywood masala than a Hollywood blockbuster. 

Related Topics

Business Models

A Company With a Conscience — How to Make High-Priced Products Accessible to Working-Class Families

Some products are inherently expensive. Companies can offer leasing programs, financing options and other marketing approaches to make them accessible to working families.

Money & Finance

5 Ways to Build a Business Budget for Maximum Success

Whether you're launching a startup or planning for growth, having a smart budgeting process is essential.

Marketing

How to Market to the Increasingly Socially Conscious Customer

Brands must remain adaptable as consumer preferences evolve, influenced by global events, cultural shifts and generational differences

Fundraising

Equipment Financing and Leasing: What You Need to Know

Spreading out the cost of your business's equipment is one way to make it more affordable.

Starting a Business

3 Reasons No Money Is No Barrier to Starting Your Business

The Internet offers cheap tools to create, finance and market a legitimate business -- with all the advantages and opportunity that brings.

Growing a Business

4 Tactics to Sell Expensive Products

Once you learn to approach each sale from using these strategies, you can increase your close rate and your profits.