Nitin Gadkari says his ministry aims to build roads worth ₹25 lakh crore

The government has taken multiple steps to attract investments in the infrastructure sector, including revising asset monetisation models and setting up special purpose vehicles for the ₹1 lakh crore Delhi-Mumbai corridor project, Union Minister Nitin Gadkari said on Wednesday.

The road transport, highways and MSME minister also said road projects worth ₹25 lakh crore will be built as part of the ₹100 lakh crore infrastructure building programme announced by Prime Minister Narendra Modi.

Addressing the Macquarie Momentum India Conference, Gadkari said he cleared two large highway projects worth ₹65,000 crore on Wednesday, including the ₹35,000 crore Amritsar-Ajmer express highway project.

"Road construction industry has a high potential to revive the economy because liquidity is basically the most important problem. Because of Covid-19, whole world is facing the crucial problem. India is also facing this problem and I feel that investment in infrastructure will bring more liquidity which is very important for Indian economy," Gadkari said.

He said to attract more investment in the asset monetisation programme under toll operate transfer (TOT), the model has been revised in line with the department of disinvestment model allowing the realistic price discovery of an asset.

Infrastructure debt funds have been allowed to participate in the direct financing of the asset under monetisation through this route, he said, adding many projects have been made available to help investors plan their investments.

Besides, the minister said investment trusts and special purpose vehicles (SPVs) have been introduced for investments in the Delhi-Mumbai corridor.

For 35 logistics parks under the Bharatmala initiative, SPV National Highways Logistics Management Company has been set up with Member NHAI Manoj Kumar as its chairman.

Gadkari said with enhanced focus on electronic toll collection through FASTags, toll collections are likely to reach ₹33,000 crore by March and swell to ₹1 lakh crore by 2025.

Elaborating on multiple interventions to fast-track highways construction, the minister said technical and financial qualification for eligibility has been relaxed to encourage wider participating of builders in HAM (hybrid annuity model), EPC (engineering, procurement and construction) and BOT (build, operate and transfer) models of the road sector.

Large financial relief packages to existing partners in construction and road sector have been given to help them cope with the financial and logistic issues faced due to the slowdown in the economy, he said.

Working capital requirements have been streamlined by rescheduling and fast-tracking payment cycles, thereby releasing more than ₹8,000 crore worth of payments in such measures in the first six months of the lockdown, Gadkari pointed out.

Performance security requirement has been done away to ease cash flow in the sector and funds worth ₹4,000 crore have been released so far, he said and added the existing PPP contractors either in HAM, BOT or toll have been compensated for losses.

The minister said policy initiatives to expedite work in the sector include revision of public private partnership (PPP) model agreement, acquisition of 90 per cent land before the project permission and introduction of revenue sharing model every five years.

Terming India as the preferred destination for investment, he urged investors to reap rich dividends by investing in projects.