India has the third largest road network in the world. But the quality of the system leaves a lot to be desired. The Indian Government has finally seen the light and has now focused on consolidating the National Highway System, under the National Highway Authority of India (NHAI). Roads in India are divided into five categories for the management and administration purposes:
National Highways (NH)
State Highways (SH)
Major District Roads (MDR)
Other District Roads (ODR)
Village Roads (VR)
Unfortunately, the roads in India are of poor quality with no minimum basic standards. The plan for the Rs. 60,000-crore Golden Quadrilateral and the North South East West corridor connections has changed the status of the highway system in India. The National Highway Development Project (NHDP) has boosted the cement market in India by 5-10% per annum, based on the fact that one-third of the planned 14,400 km. of highways will be in concrete over the next 5 years. According to the Cement Manufacturers Association (CMA), one km of 4-laned concrete requires about 2000 tonnes of cement. Most of the contracts for road construction have been given to private companies with penalties and incentives provided to ensure the best quality of roads at the lowest costs. There is a need for the highways to be developed by the private sector on a Build, Own & Transfer (BOT), Build, Own, Operate & Transfer (BOOT) and other such schemes. The Government of India has offered the detailed feasibility study, land for right of way and en-route facilities without any encumbrances, relocation of utility services, resettlement and rehabilitation of the affected establishments. The environmental clearances and land acquisition procedures will need to be streamlined. Also the investment incentives such as exemption of duty free imports of construction equipment and 100% income tax exemption for 5 years must be given to the private companies, along with collection of tolls and concession stall outlets.
The road network in India has been growing at the rate of 4% while the traffic has been growing between 8 to 12% per annum. It has not been possible for the central and state governments to invest the capital amounts required to keep up the pace of road construction. Hence various methods have been proposed to arise the funds in this sector including NHAI bonds, private investments and companies who would construct and maintain the highways under the BOT schemes. Several of the existing highways will need to be upgraded, crossings minimized and over bridges repaired to bring the highway system up to international standards. This will also include educating the driving masses on how to use such highways. In fact, some of the vehicles will also need tremendous upgrading. The octroi system will also have to be abolished nation wide to reduce the holdups in the Indian highways. The maps below provide the highway network of India along with the proposed projects due for completion in 2007.
A well-connected India will see the impact of good highways on its economy. Time and fuel savings alone will justify the high cost of highway construction. Productivity, trade and business will also witness tremendous improvements and people will generally travel more for other reasons also. The physical disconnect between the urban and rural India will be minimized and the exodus from the villages to the cities will be reduced. Rural India will feel the positive impact of good highways faster than the rest of the country. Plus better roads will reduce the wear and tear costs of maintenance of vehicles. Presently, there are 7,400 petrol outlets along the highways, with another 8,250 retail outlets in the pipeline for the private sectors. Clearly the roads/highways in India is one of the most important infrastructure systems, which will decide the direction of the real estate growth and economy of the country.
A good road transport system plays a prominent role in the movement of goods and passengers all over the country. It is the best mode of service transport to serve the hilly, rural and backward areas not connected by railways.