MUMBAI: The impressive response shown by private players towards the government’s highway monetisation programme is expected to significantly reduce the burden on government finances to fund road projects in coming days.
The NHAI, which invited bids for the first lot of projects on the toll-operate-transfer (TOT) model saw participation from four players with Singapore’s Macquarie Asia Investment Fund winning the contract. It won the rights to collect toll on 648 km of highways for a period of 30 years by quoting Rs 9,700 crore as against NHAI’s expectation of Rs 6,300 crore.
The other bidders for the project were Brookfield, IRB Infrastructure, and a JV between Roadis Infrastructure Holding and National Investment and Infrastructure Fund, who quoted Rs 7,500 crore, Rs 6,900 crore and Rs 6,600 crore respectively.
“This will help NHAI raise upfront capital to fund road projects based on the engineering procurement contract and hybrid annuity modes. We view this as a seminal event in the Indian infrastructure space since this will start a virtuous cycle of the government funding various infra projects, completing and then eventually monetising them, with the money raised being used to develop new infra assets. This will reduce the burden on the government budget as far as infra development is concerned,” said Edelweiss Financial Services.
According to it, out of Rs 1.2 lakh crore road sector budget in FY19, Rs 62,000 crore is supposed to come from internal and extra budgetary resources of NHAI.
