Union Road Transport and Highways Minister Nitin Gadkari expressed on Tuesday that the National Highways Authority of India (NHAI) is encountering challenges in the formulation of detailed project reports. This is due to certain companies' reluctance to embrace new technology, according to the union minister.
In his address at the 'CRISIL India Infrastructure Conclave 2023,' Gadkari emphasized that the government is actively promoting the adoption of innovative technologies in infrastructure development. He raised concerns about significant players in the steel and cement industries, accusing them of engaging in cartelization to artificially inflate prices.
He noted, "The steel industry and cement industry... whenever they find the opportunity, they form cartels and hike the rates."
Gadkari underscored the difficulty in assessing the performance of companies responsible for creating detailed project reports (DPRs), indicating it as a major hurdle. He stated that the quality of DPRs remains subpar across various projects.
He further explained, "During the DPR preparation, these companies engaged in DPR creation are unwilling to embrace new technology, innovations, or research. Additionally, the standard of DPRs is so lacking that there is consistently a need for additional scope of work."
Discussing the logistics costs in India, Gadkari highlighted the disparity compared to other countries. He pointed out that logistics expenses in India range from 14% to 16% of the cost, while in China, it typically stays between 8% and 10%.
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