Highway Builders Fight Govt Arbitration Ban

Highway developers have voiced strong opposition to the government's plan to eliminate arbitration for major road projects. The National Highway Builders Federation argues that without a timely adjudication process, disputes risk becoming protracted, inflating claims through accumulated interest. They have suggested alternatives like structured settlements and improved dispute resolution within the authority itself.

Past instances highlight how original claims of ₹50-100 crore can escalate to ₹150-300 crore over a decade or more, primarily due to interest. Courts have often awarded interest on delays attributed to the authority, sometimes exceeding the principal amount. The road transport ministry's proposal seeks to end arbitration for disputes over ₹10 crore, favoring mandatory conciliation or mediation instead.

This initiative aims to address concerns about alleged malpractices and lengthy arbitration timelines. Government officials believe ending arbitration will allow for better control over outcomes in significant disputes, as many awards have previously been challenged or ruled against the government. The sector saw claims of approximately ₹90,000 crore between 2015 and 2025.