India in talks with Japanese lenders to raise more funds for highway projects.

India has initiated talks with Japanese lending agencies for funding of its ambitious highways programme which entails addition of over 50,000 km over the next five years.

Road Transport and Highways Minister Nitin Gadkari held a discussion with representatives of Japan Bank for International Cooperation (JBIC) last week for increasing its lending to India, a senior ministry official said. 'We want funding on soft terms for highways and expressways projects,' said the official, who did not wish to be identified.

India needs Rs. 5 lakh crore over the next five years to expand its highways to 1.5 lakh km from the existing 96,000 km. In addition, the country has an ambitious plan to construct 10 greenfield expressways spanning over 16,000 km.

'The key issue with infrastructure in country right now is unavailability of funds. PPPs (public-private partnerships) are yet to pick up and expressways anyway are much more capital intensive than highways,' said Jaijit Bhattacharya, partner-infrastructure at KPMG in India.

JBIC is a major player for providing funding for large infrastructure projects. It will certainly provide a big push to India's roads sector, said Bhattacharya.
The bank has already made significant commitment to several power projects in India, and recently to build Andhra Pradesh's new capital in Amravati.

JBIC also holds equity in the Delhi-Mumbai industrial corridor project.

THE NEW INDIAN EXPRESS