Highway capex cut as construction lags
NEW DELHI : Monsoon rains that arrived late but then lingered for an extended period, coupled with land acquisition delays, have slowed down road-building in the country. Signs of slowdown in road construction became pronounced with the government scaling down capital expenditure for the sector in calendar year 2023. It built just about 23% of highways in the first five months of FY24 against a record target of 13,800 km.
As per latest data from the ministry of road transport and highways (MoRTH), just about 3,196 km of highways had been built between April and August, while capex spent during the period stands at around 43.3% of the record ₹2.58 trillion provided in the budget for this fiscal. The momentum for capex was maintained in the first quarter of FY24 by when 38% of the amount was spent. Going by this, MoRTH has set targeted spending of 91% of annual capex by December earlier.
In its latest report, MoRTH has scaled down capex spend target to 80% by December, 2023. “The momentum was expected in road construction this year as it falls just ahead of general elections next year. But a mix of climatic conditions and delays in land acquisition for awarded projects may result in slower highway construction this year," said an infrastructure expert from one of the four big consultancy firms on condition of anonymity.
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