New Delhi: The Union Cabinet chaired by Prime Minister Narendra Modi approved the NH-326 widening project in Odisha, clearing the strengthening of the existing two-lane highway with paved shoulders from Km 68.600 to Km 311.700 at a cost of ₹1,526.21 crore.
The project will be executed under the NH(O) programme on EPC mode. Officials said the total capital cost includes a civil construction component of ₹966.79 crore. The upgraded corridor will pass through southern Odisha, covering the districts of Gajapati, Rayagada and Koraput.
According to the government, the NH-326 widening project will improve travel speed, safety and reliability. It will also support economic activity in backward and tribal regions by improving access to markets, healthcare, education and employment.
At present, the Mohana–Koraput stretch suffers from sub-standard geometry, sharp curves and steep gradients. These deficiencies restrict the movement of heavy vehicles and reduce freight efficiency. The upgrade will address these issues through geometric corrections, pavement strengthening and removal of accident black spots.
The improved highway will also lower vehicle operating costs and reduce travel time. Officials said travel between Mohana and Koraput would reduce by nearly 2.5 to 3 hours, along with a distance saving of about 12.46 km.
NH-326 widening project to boost connectivity and jobs
The upgraded NH-326 will provide better connectivity to major economic and logistics corridors. It will link with NH-26, NH-59, NH-16 and the Raipur–Visakhapatnam corridor. The project will also improve last-mile access to Gopalpur port, Jeypore airport and several railway stations.
The corridor connects key industrial units such as NALCO, IMFA, Utkal Alumina, Vedanta and HAL, along with education and tourism hubs including the Central University of Odisha, Koraput Medical College, Taptapani and Rayagada. Officials said the project would support faster freight movement and regional economic development.
The Cabinet noted that the project’s economic internal rate of return stood at 17.95 per cent, reflecting strong social and safety benefits. The work will be completed within 24 months, followed by a five-year defect liability and maintenance period.
The government said construction and maintenance activities would generate significant direct and indirect employment for skilled and unskilled workers. Officials added that the NH-326 widening project would play a key role in improving connectivity between Odisha and neighbouring Andhra Pradesh.
