Will plain-speaking Gadkari trigger NHAI reform?

Road transport and highways minister Nitin Gadkari’s caustic public remarks against the ‘non-performing’ lot among the National Highway Authority of India (NHAI) officers at a recent event may have breached the unwritten norm of restraint that the top political executive shows in dealing with the bureaucracy it relies on, but have elicited approving commentary from a wider audience.

On Monday, while inaugurating NHAI’s new office building at Dwarka in New Delhi, which took nine years for completion, through video-conferencing from Nagpur, Gadkari said NHAI had become “a breeding ground for inefficient officials, who are incapable of taking decisions and prefer to refer every matter to committees.” It was time to show the exit door to such ‘non-performing assets’ who only complicate matters and delay projects by creating obstacles, he said.

“While NHAI is building 4,000-km national highways in a year and pledges to complete the Delhi-Mumbai Greenfield expressway project in three-and-a-half years, why would it take nine years to complete its own office building? There must be some reasons behind this,” a senior official said on condition of anonymity.

Gadkari is known for setting daunting targets for himself and persistently pursuing them. Of course, his ambitious goals have tended to look too distant to be real, yet the minister hasn’t scaled down his plans.

Top his credit, he has added pace to highway construction even amid a prolonged, complete absence of pure-play PPP projects – highway construction accelerated from under 17 km per day in FY16 to about 30 km per day in FY19 despite the economic growth plunging to an 11-year low in FY20, the highway construction pace was maintained at 28 km a day in the year. The sector has also been one of the least affected by Covid-19 in the current year, with construction pace so far being at 22 km a day.

Mincing no words, Gadkari described the unnamed few among the authority in the ranks of chief general managers and GMs as ‘nalayak and nikarma”. Speaking to FE, sources in the NHAI, who do not wish to be identified, appreciated the minister’s ire – ‘nine years is long a time to complete a G+7, 6,086 sq m building’– but protested his use of “derogatory words against senior officials in a public platform”. The occasion was not fit and proper for such blistering comments either, they felt.

Gadkari wants highway construction pace to reach 40 km per day; he has also spoken recently about a whopping Rs 15-lakh crore investment plan for the sector over the next two years.

While the highway construction sector has largely insulated itself from the lockdown effect, the government is unveiling more incentives to investors to speed up the pace further. Gadkari’s ministry has decided to release the financial support to hybrid annuity model (HAM) projects in 10 equal instalments during the construction period, as against 5 now, a move that will boost liquidity of the concessionaires. The ministry is also working on some incentives for the Engineering, Procurement & Construction (EPC) contractors, the mainstay of the industry over the last few years amid a near complete absence of pure-play build-operate-transfer (toll) projects. The eligibility conditions for EPC contractors may be relaxed.

NHAI decided to set up the second office building, adjacent to its existing one at Dwarka, as early as in 2008. Tenders for the project were issued in 2011, but it too long for the construction of the building to be completed. NHAI sources say termination of the initial contract for the building project mid-way and frequent changes in NHAI brass and in the responsibilities assigned to various officials caused the delay. NHAI currently has 16 CGMs and GMs.