Highway projects in 4 States face tough time: Crisil

Our Bureau Hyderabad | Updated on May 15, 2020

An analysis of over 270 under-construction national highways indicates that the top 10 States account for 80 per cent of the projects and in four of these States project execution is at risk.

According to Crisil Research, Maharashtra, Uttar Pradesh, Tamil Nadu and Andhra Pradesh, that account for over a third of the projects, are among zones of maximum risk.

In its report, “On the highway, four states of discomfort,” Crisil maintains, “Construction of national highways has come to a grinding halt with the nationwide lockdown imposed on March 25, 2020, to fight the Covid-19 pandemic. However, to the relief of developers, the government allowed resumption of construction from April 20, subject to clearances from district administrations.”

But activity remains stalled due to severe shortage of labour and raw material, and difficulty in securing requisite clearances. What’s more, the Centre has divided districts into red, orange and green zones based on the extent of contagion. Only insitu construction is allowed in red zones until the next announcement.

In Maharashtra, which has 11 per cent of the national highway projects, as much as 55 per cent of it is in red zones. In Uttar Pradesh, which has the lion’s share of projects under construction at 15 per cent, a third is in the red zones. Projects in Tamil Nadu and Andhra Pradesh, each with over 35 per cent projects in red zones, are also at risk. In the milieu, for developers, containment of the pandemic and lifting of the extended lockdown are the key monitorables for a return to normalcy.

In its series, “Covid corollaries,” the Crisil report states “About a fifth of under-construction NHAI projects are in the red zones of the top 10 states. Those in Maharashtra, Uttar Pradesh, Gujarat, Tamil Nadu and Andhra Pradesh are at higher risk.”

Published on May 15, 2020

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