Roads and Buildings Minister Komatireddy Venkat Reddy at a meeting in Hyderabad on Monday.
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 allegations of overbidding by contractors.
On the issue of ‘over-tendering’, officials clarified that Telangana has seen a lower percentage of overruns compared to several other states that are implementing HAM projects. They pointed out that Gujarat witnessed overbidding of up to 66% while Maharashtra saw around 47% positive overbidding. Similar trends were also observed in NHAI projects where bids exceeded estimates by as much as 50%.
Officials attributed the project’s increased cost to rising global economic pressures, including sharp increases in fuel, bitumen, steel and cement prices, along with GST, maintenance responsibilities and war-related disruptions to supply chains.
Officials informed the minister that bitumen prices have almost doubled, rising from ₹44,000 per metric tonne at the time the tender was launched to around ₹89,000 at present. HAM projects include additional expenditure compared to normal road works due to advanced use of equipment and machinery, 15-year maintenance obligations, patrol vehicles, ambulance services, GST and interest components alone contribute to an additional burden of almost 9.3%.
Under HAM Phase-1, the Roads and Buildings Department is carrying out 441 road development works at an estimated cost of ₹ 13,006.27 crore covering 6,092.37 kilometers through 34 packages. Besides, the Panchayat Raj department is carrying out 2,162 road works worth ₹6,250 crore over 7,450 kilometers under 17 packages.
The minister said he would meet Chief Minister A. Revanth Reddy either on Tuesday or Wednesday to discuss the final aspects of the HAM projects.
Published – 11 May 2026 20:49 IST
