A high-level delegation from China Railway Construction Corporation Ltd (CRCC), which is a government of China enterprise, led by Chief Economist Zhao Jinuha, met National Highways Authority of India (NHA)I Chairman Raghav Chandra and a team of NHAI officers at our national highway construction company’s headquarters in New Delhi. China Railway Construction Corporation Ltd is one of the world’s largest integrated engineering contractors and construction groups, with over $100 billion of revenue and a market capitalization of around $250 billion.
National Highways Authority of India Chairman Raghav Chandra explained that they have projects lined up for upgradation of two-lane national highways totaling 50,000 km, various special expressway projects of around 15,000 km and a part of the National Highways Development Programme (NHDP) over the next few years.
National Highways Authority of India is also looking at various other connectivity projects in India for by-passes, ring roads around major cities contributing towards the Smart Cities Projects. There have been recent policy changes in the sector for implementing the highway construction programme, especially the introduction of hybrid annuity model where public-private-partnerships move in tandem with the requirements of sustained progress focusing on risk mitigation.
Industry interest in participating in the projects of National Highways Authority of India is increasing due to the policy changes. China Railway Construction Corporation Ltd expressed keen interest in participating in the upcoming projects of National Highways Authority of India under the both Engineering, Procurement and Construction’ (EPC) and Hybrid Annuity Model.
Apart from being the major contributor to China’s high-speed and normal alpine and plateau railways, China Railway Construction Corporation Ltd has provided survey and design services for highways, urban rail transit, real estates and other infrastructure projects.
China Railway Construction Corporation Ltd boasts leadership in globally advanced cutting edge technologies and expertise not only in design and construction of railways but long span bridges, highways, large-section tunnels with significant buried depths, and special geological conditions and under-water tunnels.
The China Railway Construction Corporation Ltd delegation had an in-depth discussion on various aspects of such participation in National Highways Authority of India projects. The visiting team also enquired about the acceptance of Chinese technical standards.
National Highways Authority of India officials clarified that they would be acceptable only if they are higher than the prescribed standards of the Indian Road Congress. Their queries mostly pertained to finding financial solutions with requisite IRR, addressing upward price fluctuations of essential materials like bitumen, fuel, steel and cement during the period of construction under the Engineering, Procurement and Construction’ (EPC) and Hybrid Annuity Model.
The Chinese delegates were keen on knowing about any restrictions on sources of procurement from abroad, import certifications requirements, whether US dollars could be the currency of repayment (as annuity), availability of repayment guarantee and proof of capacity of the client (National Highways Authority of India) to repay (ie to pay the annuity and the funding under the Hybrid Annuity Model) to provide comfort to their lenders.
There was an informative dialogue with the team and National Highways Authority of India officials also sought the details of Chinese policy and models of concessions, funding solutions etc. National Highways Authority of India officials presented an overview of policy, procedures and risk and responsibility distribution between private and public partners and provided clarifications addressing the queries of the visiting China Railway Construction Corporation Ltd delegates.