Contractors claims Rs 88,000 crore in highway project disputes

Private contractors in disputes in the highway projects undertaken by the National Highway Authority of India (NHAI) have raised a whopping Rs 88,100 crore claims in arbitration in the last five years, said a Parliamentary Standing Committee report.

The Standing Committee on Transport in its report, which was tabled in the Parliament, also said that the NHAI counterclaims are to the tune of Rs 39,221 crore against claims by the private contractors.

Total 122 cases are pending for arbitration in which 21 cases are under conciliation while 18 cases are reserved for the award, said the report.

The report also said that in the last five years (2017 to 2022) total of 48 cases was settled and the settled amount was Rs 6,101 against the claims of Rs 16,733 crore.

The standing committee headed by BJP Rajya Sabha member T G Venkatesh expressed concern over the huge amount of claims pending under arbitration.

The committee recommended that the process of arbitration should be quick to ensure road projects do not get stuck. The panel also suggested the NHAI constitute more CCIEs (Conciliation Committee of Independent Experts) to allow faster, parallel processing of the pending arbitration cases.

With regard to the present mechanism available to settle arbitration cases in NHAI, the Union Ministry of Road Transport submitted to the Standing Committee that NHAI has made an effort to settle the disputes between the Parties, through an effective mechanism which has been adopted in NHAI to establish a Conciliation & Settlement Mechanism for Contractual disputes under Contract agreement through a Panel of Independent Experts comprising Retired Judges, bureaucrats and reputed persons from the industry having expertise in infrastructure known as CCIE.

Three Committees have been constituted to expedite the conciliation. Further, NHAI has also framed a Policy Guidelines and according to which it seeks opinion of Law Officers-Attorney General/Solicitor General/Addl. Solicitor General of India in consultation with the Department of Legal Affairs (DoLA), before challenging the award, the ministry informed the panel, the report says.

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