NHAI Revises Policy to Streamline Reimbursements for Future Projects

The National Highways Authority of India (NHAI), through Policy Circular No. bearing Reference No. 7.2.19/2025 dated October 23, 2025 (the “Circular”), has issued a revised framework for reimbursement of statutory and ancillary charges associated with utility shifting works in National Highway (NH) projects executed under Hybrid Annuity Model (HAM) and Engineering Procurement and Construction (EPC) modes. The Circular aims to eliminate delays and procedural uncertainties, particularly in relation to transmission line shifting that often impedes project timelines.

By extending and refining the principles laid out in earlier circulars, this policy update formalizes direct payment mechanisms for various statutory charges by NHAI and sets clear reimbursement norms for upcoming projects.

Utility shifting especially of transmission and power lines, has long been a critical bottleneck in NH project execution. Multiple agencies, complex approvals, and reimbursement disputes over charges such as survey fees, processing fees, safety No Objection Certificate (NOC) fees, and shutdown costs have contributed to delays and cash flow issues for concessionaires and contractors.

Recognizing these challenges, the Ministry of Road Transport and Highways (MoRTH), through its circular bearing Reference No. RW/NH-33044/29/2015 dated February 11, 2021 had first introduced a Standard Operating Procedure (SOP) for utility shifting works, providing a structured approach for coordination among stakeholders. Building on this, NHAI later issued policy circular bearing Reference No. 7.2.18/2025 dated September 3, 2025, which enabled direct payment by NHAI to utility-owning agencies (UOAs) for ongoing projects, covering charges such as processing fees, registration fees, shutdown charges, and related taxes.

However, while that policy clarified reimbursement for existing and ongoing projects, it left ambiguity regarding upcoming future projects. The Circular now addresses that gap comprehensively.

The Executive Committee (EC) of NHAI, in its recent deliberations, approved a set of uniform payment and reimbursement provisions to be incorporated in Requests for Proposals (RFPs) and SOPs for all future NH projects:

1. Direct Payment by NHAI to Utility-Owning Agencies: For upcoming projects, NHAI will directly pay all statutory and ancillary charges related to utility shifting works to the UOAs. These include:
   • Survey Charges;
   • Processing and Application Fees;
   • Registration Charges;
   • Safety No Objection Certificate (NOC) Fees/Charges (where applicable); and
   • Revenue Loss and Shutdown Charges.

Such direct payments ensure administrative efficiency and relieve concessionaires from front-loading such costs.

2. Handling of Shutdown Charges and Deemed Availability: A specific clarification has been issued concerning shutdown charges in the context of transmission line shifting:

1. 1. Where the Regional Power Committee (RPC) rejects a ‘deemed availability’ request, NHAI shall directly reimburse shutdown charges to the UOAs based on actuals, following verification and certification by the UOAs, Independent Engineer (IE)/Authority Engineer (AE), and NHAI representatives.
   2. If the shutdown period exceeds the approved duration for which ‘deemed availability’ was not permitted, the excess shutdown charges will be adjusted against future payments of the contractor or concessionaire.

This mechanism ensures a balanced approach protecting both NHAI and the executing agency from unwarranted cost overruns while maintaining accountability in certification.

3. Incorporation in Future RFPs and SOPs: The above provisions are mandated to be incorporated in all upcoming project RFPs and Sops by the CMD division of NHAI headquarters. This institutionalization will make the policy operational for all new project bids going forward.

The Circular reinforces NHAI’s commitment to financial clarity and timely execution by institutionalizing direct reimbursement mechanisms for utility shifting in upcoming projects. By embedding these provisions into future RFPs and SOPs, the Authority ensures predictable cost management, reduced delays, and stronger coordination among stakeholders.