Dharam Prakash Gupta

The ongoing work on Kiratpur – Nerchowk Express Highway (KNEH) – NH 21 has come to standstill as contractors executing this project have stopped all construction activities since 22nd June 2018 for failure of ITNL and IL&FS companies engaged by National Highway Authority of India (NHAI) to make payment of nearly Rs 45 crore due to the contractors.

This has stopped all construction activity further delaying the project, escalating the construction cost manifold and depriving people a major facility, which is already two years behind its schedule completion in 2016.

The KNEH project was initiated by the NHAI and construction work was awarded to Kiratpur –Nerchowk Express Highways Limited, which engaged ITNL to execute the project on Built Operate Transfer (BOT) basis for 28 years to the company. This company incorporated IL&FS Engineering as procurement contractor. The companies further engaged nearly 50 sub-contractors for execution of the work.

The work on this project started in 2013 with an estimated cost of Rs 1800 crores and was scheduled to be completed by the end of 2016. The 67.3 kms KNEH project having 5 tunnels, one escape tunnel and 18 bridges would reduce the distance between Kiratpur and Nerchowk by approximately 36 kms.

Four lane express highway would facilitate thousands of tourists traveling daily between Manali and Chandigarh, considered one of the life lines of Himachal. This road is also used by thousands of truckers daily for transporting cement from three cement plants, apple, tomato and other goods to and fro, besides being of a strategic important road link with Leh.

Ashok Thakur, senior vice president of the Kiratpur- Nerchowk Four Lane Contractors Association in a memorandum submitted to Chairman of the NHAI citing reasons for stopping the work has “accused ITNL for not making payment of about Rs 45 crore for the work carried and material purchased by them.”

“The Association apprehends mis-management of funds creating a financial crisis and an imminent take over of their machinery and material by the financers and banks,” the association claim.

Insiders tell, “Though about 50 percent work has been completed the company has already availed finance of about Rs 1300 crores against the total project cost of Rs 1800 crores from banks and other financiers.”

While the project may suffer inordinate delay there is also a danger of the project becoming unviable since 5 years of 28 years BOT period are already over and any further delay would reduce the period of earning to the company through TOLL Tax as the project cost is likely to go up to about Rs 3400 crores. .

Halting the construction activity by contractors has also put 900 meters tunnel no 1, constructed near Swarghat to danger as dewatering of the tunnel has also been affected.  About of 700 liters water per minute is being getting accumulating in the tunnel and NHAI is making effort to dewater the tunnel.

Experts building the tunnel tell, “Delay in construction work may endanger main tunnel as it requires strengthening of the interior wall and any delay looms danger of its collapsing.”

Three labourers were trapped tunnel at Tihra being dug for the project had caved in about two years ago leading to death of one of them and narrow escape for the other two.

Colonel Yogesh Chandra, Project Director NHAI, said “The work on KNEH has been stalled due to financial crunch, at present dewatering of tunnel has also been affected.”

“We are trying to restart the work on this project by resolving various issues by taking up these with the NHAI,” he added.


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8 thoughts on “Financial crunch stalls work on Kiratapur – Nerchowk Express Highway

  1. It’s fall out of Govt PPP model (BOT) which was non viable proposition for Pvt players to run the project in hilly area even they have bidding at the lowest rate to built the road. That’s why NHAI is constructing Nerchowk-Manali road thro pvt players .

    1. You are right in fact this is the real reason. NHAI has been callous in its approach which has resulted into this situation .
      Any way thanks for reacting.

  2. यात्रा के दौरान लगने वाले समय में कमी होने के कारण लाखों लोगों को समय की बचत होती… सैलानियों की संख्या में वृद्धि होती… वाहनों की टूट-फूट, घिसाई में कमी आती, वे अधिक साल चलते… दुर्घटनाओं में कमी आती… डीजल, पेट्रोल की भारी बचत होती… विदेशी मुद्रा की भारी बचत होती… हिमाचल की अर्थ व्यवस्था को भारी फ़ायदा पहुंचता.. टुकडो में थोड़ा-थोड़ा भी काम किया होता तो अब तक पूरा होने के नजदीक होता… इसके लिए कौन उत्तरदायी है…?

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