NEW DELHI: The central government’s pet Bharatmala Pariyojana (BMP) Phase –I is likely to be delayed by four years on account of the viral pandemic, rating agency ICRA said on Wednesday.
According to the agency, the project is now likely to get completed by 2025-26 instead of the earlier envisaged 2021-22.
That apart, the prevailing uncertainty due to COVID-19 and the consequent impact on valuations could also delay asset monetisation plan of NHAI – toll-operate-transfer (ToT) auctions and launch of infrastructure investment trust (InvIT).
“As of March 2020, 16,219 km of BMP (around 47 per cent of BMP) was pending to be awarded. We expect the awards to remain in the range of 3,000-3,200 km in FY21 and increase thereafter when NHAI completes its proposed fundraising through infrastructure investment trust. With pick-up in awards starting FY22, the Bharatmala awarding activity is only expected to get completed by FY23,” says Shubham Jain, senior vice-president, corporate ratings, ICRA.
Jain added that about 21 per cent of BMP execution is completed as on March 31, 2020.
Given the limited labour, and productivity loss due to the coronavirus-led lockdown, ICRA expects the pace of execution for FY21 to remain low at 3,104 km and thereafter witness an increase by 10-15 per cent in FY22 (on base of FY20) before peaking in FY24. The pending works are expected to be completed by FY26, it added.
Earlier in October 2017, the Cabinet Committee on Economic Affairs approved the BMP Phase-I along with other programmes.
A total of around 34,800 km are being considered in BMP Phase I which also includes 10,000 km of balanced road works under NHDP.
Meanwhile, the government has set an ambitious target of awarding contracts for 20,000 kms and building 15,000 kms of highways in FY21 despite total construction falling to 210 km in Apri as against 792 km in 2019.