Roads and Buildings Minister Komatireddy Venkat Reddy conducted a detailed three-hour review meeting on the progress of Hybrid Annuity Model (HAM) road projects in view of the allegations of excess tender quotes by the contractors.

Regarding “excess tenders”, officials clarified that Telangana recorded lower excess percentages compared to several other States implementing HAM projects. They pointed out that Gujarat witnessed excess bids up to 66%, while Maharashtra recorded around 47% positive excess bids. Similar trends were also seen in NHAI projects, where bids exceeded estimates by up to 50%.

Officials attributed the increased project costs to rising global economic pressures, including sharp increases in the prices of fuel, bitumen, steel, and cement, along with GST, maintenance responsibilities, and war-related disruptions affecting supply chains.

The officials informed the Minister that bitumen prices had nearly doubled, rising from ₹44,000 per metric tonne at the time of tender initiation to around ₹89,000 currently. The HAM projects involve additional expenditure compared to regular road works due to advanced plant and machinery usage, 15-year maintenance responsibilities, patrolling vehicles, ambulance services, GST and interest components alone were said to contribute an additional burden of nearly 9.3%.

Under HAM Phase-1, the Roads and Buildings Department is executing 441 road development works at an estimated cost of ₹13,006.27 crore covering 6,092.37 kilometres through 34 packages. In addition, the Panchayat Raj Department is implementing 2,162 road works worth ₹6,250 crore spanning 7,450 kilometres under 17 packages.

The Minister stated that he would meet Chief Minister A. Revanth Reddy either on Tuesday or Wednesday to discuss the final aspects of the HAM projects.