Gujarat Moves to Performance-Linked Contracts for Road Projects
April 01, 2026
Gandhinagar: In a significant move to enhance the quality and longevity of the state’s infrastructure, Chief Minister Bhupendra Patel has approved the implementation of Output and Performance-Based Contracts (OPRC) and Performance-Based Maintenance Contracts (PBMC) for the Roads and Buildings Department. The decision marks a strategic shift from merely expanding the road network to ensuring high-quality, long-term maintenance through scientific methods.
Focus on Road Longevity and Safety
According to a government press release, while substantial investments have been made in road expansion to boost connectivity and economic activity, maintaining existing roads is now equally critical. The new policy emphasises that timely and scientific maintenance can significantly extend a road’s lifespan, ensure safer travel, and protect infrastructure investments. Failure to carry out preventive maintenance often leads to serious defects, requiring costly repairs or reconstruction within a short period.
OPRC Model for Major Projects
For road widening, new construction, or strengthening projects with an estimated cost exceeding ₹25 crore, the state will adopt the OPRC model. Key features include:
- Long-term contracts: Typically spanning 10 years, including two years of construction and eight years of maintenance
- Defined service standards: Covering smooth road surfaces, pothole-free conditions, and proper drainage
- Performance-linked payments: Contractors will be paid based on performance indicators rather than the volume of work
- Financial structure: 75% allocation for initial works, 15% for routine maintenance, and 10% for periodic maintenance
PBMC Model for Mid-Sized Projects
For projects costing up to ₹25 crore, the PBMC model—already used by the National Highways Authority of India (NHAI)—will be implemented.
- Duration: Seven years, including one year for resurfacing and six years of maintenance
- Integrated approach: Replaces multiple short-term contracts with a single long-term contract, improving efficiency
Expected Benefits
The government expects the new models to bring multiple benefits:
- Cost efficiency: Lower lifecycle costs through preventive maintenance
- Innovation: Encouragement for contractors to adopt advanced technologies and materials
- Transparency: Greater accountability through performance-based monitoring
- Improved user experience: Safer, smoother, and more reliable roads
By assigning long-term responsibility for road quality to contractors, the state aims to ensure sustained infrastructure performance well beyond initial construction. DeshGujarat
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