NHAI Scrambles to Secure Bitumen Supplies Amid West Asia Conflict Threatening Highway Programme: Report

India's ambitious highway construction programme faces potential material shortages as escalating tensions in Iran threaten bitumen shipments from West Asia. The National Highways Authority of India (NHAI) has started emergency consultations with domestic oil refineries to safeguard supplies for infrastructure projects scheduled over the coming years, says a report by Livemint. With plans to construct approximately 10,000 kilometres of highways during the 2026-27 financial year, bitumen -- a critical component in road building -- has become a strategic concern for Indian authorities.

According to the report, NHAI officials have approached state-owned refiners including Indian Oil Corporation Ltd (IOCL), Bharat Petroleum Corporation Ltd (BPCL), and Hindustan Petroleum Corporation Ltd (HPCL) to guarantee uninterrupted supply chains should West Asian imports face disruption.

"Bitumen prices are revised every 15 days, and in discussions with highway builders, NHAI has said it will coordinate with oil marketing companies like IOCL, HPCL and BPCL to ensure that supplies are not impacted," a person aware of the discussions was quoted as saying.

India's Bitumen Dependency

Industry estimates indicate India requires approximately 9 million tonnes of bitumen annually to support its infrastructure ambitions. Domestic prices typically fluctuate between ₹40,000 and ₹60,000 per tonne depending on grade specifications, whilst international markets price the material around $400–$500 per tonne -- broadly equivalent to Indian rates when currency conversion is factored in.

The Ministry of Road Transport and Highways, operating through NHAI, has commenced sector-wide consultations regarding supply security, recognising bitumen as an essential input whilst acknowledging the country's substantial reliance on West Asian sources, according to a second individual familiar with the discussions.

Import Dependency Creates Vulnerability

Industry analysts warn that India's reliance on foreign bitumen could leave the construction sector vulnerable to supply chain disruptions should the West Asian conflict intensify.

India imported 35–36 per cent of its bitumen requirements during FY25, with a substantial proportion sourced from Middle Eastern nations. Of the 8.3 million tonnes of bitumen consumed in India last year, approximately 5.3 million tonnes were manufactured domestically, whilst imports accounted for the remainder.

"India imported about 35–36 per cent of its bitumen requirement in FY25, with a significant amount coming from the Middle East (West Asia). Out of the 8.3 million tonnes of bitumen used in India last year, 5.3 million tonnes were made domestically, and the rest was imported," Prashant Vashisht, senior vice-president and co-group head at ratings agency Crisil was quoted as saying.

Domestic Production Could Fill Supply Gap

Vashisht noted that Indian refineries possess the capacity to increase output should disruptions continue, offering potential relief for the construction sector.

Experts also suggest India may need to establish alternative procurement channels if West Asian supplies remain unreliable, pointing towards potential supply agreements with new geographic partners to reduce dependency on the volatile Middle Eastern region.