New Delhi: The increased budgetary allocation made for Road Transport and Highway Ministry will boost the pace of construction of highways in the country.

Despite increased allocation, the Government has also proposed to raise the target to construct 8,800 km national highways in the next fiscal.

Finance Minister Pranab Mukherjee on Friday increased budgetary allocation for Road Transport and Highway Ministry by 14 percent. Now the ministry will get Rs 25,360 crore in the fiscal year 2012-13.

The National Highway Authority of India’s target to construct roads has been increased by 20 percent. The NHAI had set the target to construct 7,300 km of roads in the current fiscal. Now the nodal agency for highway construction will have to construct 1500 km additional roads.

Union Road Transport and Highway Minister CP Joshi said, “The Government has increased the budget outlay for construction of roads. The NHAI has been allowed to issue tax free bonds worth Rs 10,000 crore in the next fiscal. Consequently, the road projects will face no lack of funds.”

In the past few years, the national highways have taken a new high. The road construction companies are not only lobbying hard to get contracts on the basis of BOT but are also giving premium to the NHAI for the same.

The NHAI has awarded tenders for 44 road projects and received Rs 2,000 crore as premium in the 24 projects.