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Business
India Introduces Rating‑Based Deposits and Crash Penalties in Highway EPC Rules
✍️ The Economic Times
🗓 21 Oct 2026, 04:47 AM
👁 6
India has updated its highway Engineering, Procurement and Construction (EPC) guidelines, linking contractor deposits to performance ratings and imposing penalties for crashes during construction.
The Ministry of Road Transport and Highways announced a comprehensive overhaul of the highway EPC framework to enhance safety and accountability on construction sites. Under the new rules, contractors must submit a security deposit that varies according to a safety and quality rating assigned by the authorities. A higher rating reduces the deposit, while a lower rating increases it, creating a financial incentive for better compliance.
In addition to the deposit scheme, the guidelines introduce explicit crash penalties. Any incident involving a vehicle or machinery that results in injury, damage or delay will trigger a fine, with the amount calibrated to the severity of the incident. The aim is to deter negligent practices and encourage proactive risk management.
The changes are expected to tighten oversight of highway projects, reduce the incidence of accidents, and promote a culture of safety among contractors. By tying financial security to performance, the government hopes to lower overall project costs while ensuring higher standards of construction and safety.
Industry observers note that the new framework could set a precedent for other infrastructure sectors, potentially reshaping how public works projects are managed across the country.
In addition to the deposit scheme, the guidelines introduce explicit crash penalties. Any incident involving a vehicle or machinery that results in injury, damage or delay will trigger a fine, with the amount calibrated to the severity of the incident. The aim is to deter negligent practices and encourage proactive risk management.
The changes are expected to tighten oversight of highway projects, reduce the incidence of accidents, and promote a culture of safety among contractors. By tying financial security to performance, the government hopes to lower overall project costs while ensuring higher standards of construction and safety.
Industry observers note that the new framework could set a precedent for other infrastructure sectors, potentially reshaping how public works projects are managed across the country.