Maharashtra government approves concretization of 6000 km roads in the state; allocates 37000 crore

The Maharashtra cabinet on Tuesday approved an enhanced budget of Rs 36,964 crore for the construction of 6,000 kilometers of cement concrete roads under the revised Hybrid Annuity Model (HAM), up from Rs 28,500 crore in February.

The Hybrid Annuity Model, which includes private sector participation, has been in effect since March 2017, following the Centre’s guidelines.

The road construction will be overseen by the newly created Maharashtra State Infrastructure Development Corporation (MSIDC), which operates under the Public Works Department (PWD). Under the updated HAM, the state government will contribute 30%, while MSIDC, the project implementer and concessionaire, will source the remaining 70% from the market.

As a result of the fund revision, the state’s financial commitment has increased by Rs 2,589 crore, while MSIDC’s share has risen by Rs 5,875 crore.

#मंत्रिमंडळ_निर्णय…#महाराष्ट्र #Maharashtra #CabinetDecisions@Dev_Fadnavis @AjitPawarSpeaks pic.twitter.com/LkJKGzVrDp

— Eknath Shinde – एकनाथ शिंदे (@mieknathshinde) August 13, 2024

Officials explained that the initial Rs 28,500 crore was allocated for asphalt roads. However, the decision to construct cement concrete roads instead has led to the increased cost, which was subsequently approved in the recent cabinet meeting.

The 6,000 kilometres of roads will be handed over to MSIDC for a period of 17-and-a-half years. The work will be conducted on an EPC (engineering, procurement and construction) basis, with a construction period of two-and-a-half years and a liability period of five years.

In February, when the cabinet initially approved the Rs 28,500 crore plan, the state’s planning and finance department had expressed concerns about the potential financial strain. They warned that such a significant expenditure might negatively impact other ongoing infrastructure projects.

The decision for a revised budget for cement concreting of roads comes amidst the uproar in the state over poor road conditions, especially the potholes-ridden roads in the Mumbai Metropolitan Region, Mumbai-Goa Highway, and Thane-Nashik Highway among others. Chief Minister Eknath Shinde had himself visited Bhiwandi in Thane district last Friday to inspect the road works.