According to a recently released report by credit rating firm ICRA, the capital expenditure scene in the road sector will be dominated by Maharastra and UP in the next three years. The report cites a host of large scale road projects in these states which are expected to unfold in the near run. For instance, the estimated spend in case of Nagpur-Mumbai expressway alone is Rs. 35,000 crore over next three years. Similarly, in UP, for Purvanchal and Ganga expressways together the estimated spend over next three years is around Rs. 20,000 crore.
Elaborating on capex outlay by states and centre, Shubham Jain, VP & Group Head, Corporate Ratings, ICRA said, “Historically, the cumulative spend by the state governments on roads was much higher than the central government spend on national highways. Most of it went unnoticed because of low proportion of public private partnership projects, wide dispersion across various geographies/ authorities and most of these contracts were smaller in terms of value which were lapped up by the local EPC contractors.”