The ministry of Road Transport and Highways has asked the Planning Commission to clarify its contradictory stand on highway sector’s regulator. Presently, Planning Commission is working on draft for setting up regulators in all public utility sectors that will directly accountable to Parliament. Road ministry is confused over the Planning Commission present position as it is opposing a proposed highways regulator on one side, while pushing for regulatory reforms covering sectors including highways on the other side. The highway ministry stated that it would respond to a request seeking comments on the regulatory reform draft only after the ‘contradiction’ is resolved.
The Planning Commission proposed rules are likely to be applicable to regulators in various sectors including telecom, power, airports and highways. Regarding the highways ministry's draft note, the commission emphasized that it doesn't expect the proposed regulator to serve much useful purpose for the sector. Over the past 12 months, the commission had also raised objections to several key policy measures proposed by the ministry to revive the highways sectors. These measures include increasing the defect-liability period of builders aimed at ensuring better quality of roads, deferral of premium payment by highway developers and allowing concessionaires to divest full equity in highway projects.
In the central budget for 2013-14, the government has proposed to set up a regulator for the highways sector. It has noted that the sector has been facing issues like financial stress, enhanced construction risk and contract management which can be better addressed by an independent authority. In the current fiscal, NHAI has managed to give just 479 km of road projects against its target of 3,000 km by September. In the previous financial year, only 1,116 km of projects were awarded against a target of 9,500 km.