Centre plans to standardise highway contracts

With highway contractors coming in for strong criticism, the Centre plans to standardise national highway contracts by including provisions contained in numerous circulars issued by the ministry of road transport and highways (MoRTH) into schedule D of the highway contract document.

Schedule D of national highway contracts includes specifications and standards to be followed by highway contractors and provided specifics in terms of deviation from standards permitted under certain conditions.

With a view to standardise the specifications and standards in line with various elements included under circulars issued by MoRTH from time to time, it is proposed that all these elements will now be included in the schedule of contract agreement itself, so that contractors get a clearer picture of work to be and do not deviate from specialisations added at various intervals based on changes in construction parameters.

The contract agreement of engineering, procurement and construction (EPC) and Hybrid Annuity Model (HAM) stipulates that the design, construction and maintenance of highways must follow the specifications mentioned in Schedule D, said an official aware of the development.

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Further, clause 1.4 of the 2/4/6-laning manual stipulates that all norms for the design and construction of the project will follow Indian Roads Congress (IRC) codes, MoRTH specifications, any other standards referred to in the manual, and any supplement issued with the bid document. Also, specifications contained in MoRTH’s policy circulars issued time to time, will be included in the contract document, the official added.

In 2013, the ministry published MoRTH Specifications for Road and Bridge Works (Fifth Revision), after which several circulars were issued based on the experience gained over the years, feedback from stakeholders, keeping uniformity and eliminating inconsistencies among the manual, specifications and IRC codes. The official said these circulars will be considered for the feasibility study and Detailed Project Report (DPR) and included in Schedule D of the contract agreement.

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MoRTH is holding stakeholder consultations on its draft circular proposing inclusion of circulars and will finalise the changes in the contract after that.

Queries sent to MoRTH remained unanswered till press time.

“This implementation was long overdue. Through cautious implementation of these standards, we as a nation will save on resources, make our roads/highways more sustainable as well as cost efficient,” said Shailesh Agarwal, partner Risk Consulting, EY India.

“The modification is being proposed for upcoming projects only (to be awarded in future). With respect to ongoing projects (projects awarded but are yet to start and projects where significant work is still pending) a possibility should also be explored to implement these modifications on gain sharing basis between government and concessionaire/contractor,” he added.

Standardisation can bring more investor

The standardisation of contract will help bring more investor interest as the government is also looming to offer more highway projects under build operate transfer route where entire risk of construction is borne by a private investor for calculated gains over the concession period through collection of tolls.

Several circulars were issued by MoRTH since fifth revision of specifications in 2013 for road and bridge works. But these were not mandated by any authority via any implementation order or incorporation in Schedule D. Hence adoption of these circulars was not uniform. In fact, neither schedule D or clauses of 2/4/6 laning manual incorporated specifications coming through various circulars that were issued based on fresh studies on construction or bringing international best practises for highways. Thus, these specifications remained only partially implemented in protects that also once certain changed were bright in manuals of contracts fir construction.

The proposed modifications will make all these circulars mandatory for being considered in Schedule D at DPR stage itself. This will help by aligning i.e. what is to be implemented.

It is for betterment not to plug any non-compliances. This will help in saving costs and making road/highway construction more sustainable, Agarwal said.

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