MoRTH records two times increase in projects’ award

The length of road projects awarded by the National Highway Authority of India and the Ministry of Road Transport and Highways increased a little over two times to 5,113 km in March 2022 as compared to the corresponding period in the preceding year. It is nearly six times higher than 735 km of the road length awarded in the previous month and with this, the total length of projects awarded in FY22 increased by 22% year on year to nearly 12,731 km.

According to analysts, the government has increased the pace of projects awarded in the road sector after the elections in five states to help MoRTH to achieve its laid down target. While the awarding of projects improved, their execution is a bit slower during the past fiscal year due to a shortage of labor, funding issues and delayed payments by the government. The pace of road construction reduced by 21% to 10,457 km in FY22 from the previous year while average daily construction fell by 21.4% to 28.6 km. In the coming quarters, they estimate that select road construction companies which follow an asset-light business model, which helps them maintain stronger balance sheets, would receive a premium from the street.