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No central funds if highways downgraded to skirt SC ban

NHAI says it won't fund the upkeep of national highway stretches if state governments denotify them as urban roads

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The central government is unlikely to fund the upkeep of roads if state governments denotify national highways as urban or district roads to comply with Supreme Court ban on sale of liquor near highways.

A senior official with National Highways Authority of India (NHAI) told DNA Money, "If they (states) want to exit, they may. It will also result in discontinuation of funds for maintenance, in case the category of highway changes."

When contacted, Ministry of Road Transport & Highways (MoRTH) officials did not say if they have received requests from any states to denotify specific NH stretches.

In less than a week since the Supreme Court's ban on liquor within 500 metres from highways, some states have already taken the lead in converting few state highway stretches under the category of either "major district roads" or "urban roads", while planning to denotify even National Highways around cities.

States which have already started adopting such a measure to circumvent the court ruling include Maharashtra (which denotified 95 km of state highways), Rajasthan (185 km) and Punjab (30 km). While West Bengal, Haryana, Chandigarh and Goa want to go ahead with a similar plan, they are still looking at options before declassifying highways.

By declassifying the state highways around bigger towns and cities the responsibility of upkeep of these very roads have been handed over to local civic bodies.

In the national highways are denotified or declassified, the states will have to approach the MoRTH first with the list of highway stretches they want to get excluded.

After which the onus of financial outgoings will also shift from the Union government's purview to that of respective state governments.

Ironically, a couple of years ago, states were queuing up with MoRTH to get several State Highways upgraded to National Highways.

The public-private partnership (PPP) or build-operate-transfer (BOT) projects will remain unaffected as an agreement is already in place and such projects are either under implementation or operational.

It will not lead to discontinuation of toll collection and spending by local district or civic authorities, said another official.

But an industry player said that unless spending on such "roads" is not a burden it should not affect the overall upkeep. Like other local roads, if these denotified highways aren't attended to and become pothole-ridden, it will negatively impact state's growth in terms of industry and infrastructure growth. It will not be easy to attract investors to set up their respective industries.

Therefore, the bureaucrats and political clan are trying to maintain a balance between loss of revenue resulting from SC ban and denotifying highways.

In Maharashtra itself, there are around 10,000 restaurant-cum-bars and about 2,000 wine shops along the highways.

"On an average 20-30 individuals work at such outlets. By shutting them so many people would get unemployed," said Adarsh Shetty, President of Indian Hotel And Restaurant Association (AHAR). It would also mean a loss of Rs 7,000 crore for the state exchequer.

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