Following repeated allegations of corruption in highway projects funded by it in India,the World Bank has sought a new system of contracts under which road builders are paid only after they produce a pre-specified quantum and quality of work.
This new model of Output and Performance-based Road Contracts OPRC,which links payments to contractors output,has not,however,been cleared by the ministry of road transport and highways MoRTH. The ministry is working on a new Engineering Procurement and Construction EPC contract,and feels the OPRC is not needed. The World Bank has been concerned over the many delays in the implementation of road projects. Issues of graft and poor quality of construction and maintenance of highways is also a matter of worry. So it has been pitching for OPRC for highway projects,especially those funded by it, said a source.
Under the OPRC model,payments to the contractor are based on output and service levels defined in the contract. The contractor is made fully responsible for the design,durability and performance of the road he builds for a specified time. States like Punjab and Gujarat have experimented with this contract for projects involving maintenance of state highways. The World Bank is learnt to have asked the National Highways Authority of India NHAI last year to look at alternative ways to award road contracts,following which the authority had floated an expression of interest.
But the MoRTH disagrees. The new EPC is coming out soon,and would address all issues of delays in construction of roads. While initially we will use it for road contracts for two-laning of roads,its scope can always be expanded as and when needed, a ministry official said.
The proposed EPC would be a hybrid between item rate and turnkey contract. The contractor would have freedom to design,engineer and execute the project based on government specifications. NHAI would pay a lumpsum to the concessionaire,incentivise developers who build ahead of schedule,and penalise those who build poor-quality roads.