NHAI forms committee to raise domestic and foreign investment for India's highways

The National Highways Authority of India (NHAI) has created National Highways Investment Promotion Cell (NHIPC) to attract domestic and foreign investment for national highway projects.

“The cell will focus on engaging with global institution investors, construction companies, developers and fund managers for building investor participation in road infrastructure projects,” read NHAI’s release.

The Centre has set an ambitious target of paving 35,000 km of National Highways under the ‘Bharatmala Pariyojana’. During the next five years, it will involve an investment of Rs 5,35,000 crore.

Given the scale of investment required, both foreign and domestic investment from public and private sector is crucial.

Under the ‘Bharatmala Programme’, there would be Economic Corridors (9,000-km), Inter Corridor and Feeder Route (6,000-km), National Corridors Efficiency Improvement (5,000-km), Border Roads and International Connectivity (2,000-km), Coastal Roads and Port Connectivity (2,000-km), Greenfield Expressways (800-km), Balance National Highways Development Project works (10,000-km), etc.

In the first phase of Bharatmala Project, 2,000-kms of Coastal Roads and Port Connectivity will be constructed, starting 2018.

“The primary focus of NHIPC will be to promote foreign and domestic investment in road infrastructure. The NHIPC will be working in close co-ordination with various connected Ministries and Departments of Government of India, State Governments, Apex Business Chambers like CII, FICCI, ASSOCHAM, and InvestIndia etc. NHIPC will also work in close co-ordination with Foreign Embassies and Missions in India and Indian Embassies and Missions situated in foreign countries,” the statement read.

As the Bharatmala Programme will require Rs 5.35 lakh crore, the government has various fund raising plans under its sleeve. The government aims at raising debt from the market to the tune of Rs 2.09 lakh crore. Another Rs 1.06 lakh crore of private investments would be channelized from Public-Private Parnertship financial model. While another Rs 2.19 lakh crore will get contributed from the accruals to the Central Road Fund, Toll-Operate-Transfer monetisation proceeds and toll collections from NHAI.

The government has already come out with a bid to monetise highways. In the first bundle, nine National Highways are put out with an expectation to earn a minimum of over Rs 6,000 crore. A total of 82 operating National Highways will be given to private players to get private investment of Rs 34,000 crore.