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Rise in Highway Development Costs

No Comments Sub Category:Municipality,Uncategorized Posted On: Sep 14, 2011

The National Highway Authority of India (NHAI) is likely to face a push up in the costs levied by The Acquisition Act. The prevailing share of the land acquisition in 24% and this seems to take a rise to 25%-30% in the total project cost.

NHAI officials said that in the past 3-4 years an acre compensation has increased from Rs 80 lakh to Rs 1.30 crore due to the escalation in circle rates. The senior official of NHAI reported saying, “This could increase, more so in rural areas. Since the responsibility of acquiring land lies with NHAI there will be no additional burden on private developers. But we have to rework our plan as there will be greater spending for this purpose,”

The issue has a positive side as well. The managing director of Madhucon Projects, N. Seethaiah reported saying, “The number of litigation will reduce and that will mean faster pace of land acquisition.  It will result in timely completion of highway projects. Right now 90% of the project delay is due to non-availability of land,”

The Professor and Chairman of Center for Public Policy in IIM, G. Ramesh added saying, “The governments can consider levying highway property tax since construction of a road pushes the property prices in the vicinity and the local body collects greater tax“.

The Times of India

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