MoRTH hits 20% of capital expenditure target in April 2024

NEW DELHI : Despite being slow on award of projects in the second half of 2023, the Ministry of Road Transport and Highways (Morth) continued with front-loading of capital expenditure, as it spent over Rs 54,500 crore for building new highways in April this year. 

The ministry has met 20.04 per cent of its capex target with 11 months remaining, Morth said in its monthly report to the Union Cabinet. The ministry has been among the front runners in early execution of capex, a strategy adopted by the finance ministry to ensure that infrastructure creation does not suffer due to excessive backlogs towards the end of the financial year.

The ministry has been among the front runners in early execution of capex, a strategy adopted by the finance ministry to ensure that infrastructure creation does not suffer due to excessive backlogs towards the end of the financial year.

Ministries are typically expected to ensure that at least two-thirds of their capex is spent by the end of the second quarter. While the highway ministry has maintained double-digit percentage shares in capex in the past, it is for the first time that it has opened the financial year having spent over Rs 50,000 crore. 

According to experts, there is still a healthy pipeline of projects by the NHAI, and impacts of the Bharatmala slowdown will be more pronounced in FY26.

The ministry had earlier expected construction (and consequently capex) to fall starting FY25 due to the delay in approval of the Revised Estimates of the Bharatmala project, which had seen a Rs 5 trillion increase in costs.

“Shortfall in award this year will reflect in the progress of construction in the FY (financial year) 2024-25,” the ministry had informed the cabinet in November 2023. 

So far, the national highway construction figures have indeed gone down in the first month of the fiscal year, but that was expected on account of the ongoing Lok Sabha elections, where construction activity is sometimes slowed down due to curbs on movement of trucks by state governments and other poll-related restrictions.

The ministry, through its executing agencies, constructed 483 kilometres of National Highways in April, compared to 523 kilometres during the same month last year. “In addition, the Ministry has deliberated the programs for the first 100 days of the new incoming Government as well as the programmes for Viksit Bharat in consultation with all its agencies and stakeholders,” the ministry said in its report.