A proposed expressway connecting Amritsar in Punjab to Jamnagar in Gujarat has been offered to the National Investment and Infrastructure Fund (NIIF) for funding. The expressway - one of the country’s longest highway projects - would reduce the distance between the two cities by 10 per cent. It is currently 1,430 km.
The NIIF is in advance stages of discussion with the National Highways Authority of India (NHAI) for the investment. Nearly 30 per cent of the contracts for the proposed Greenfield expressway have been awarded and the remaining are expected to be awarded by the year-end.
Around 10-15 construction packages were awarded, NKC Projects, VRC Construction and Krishna Construction bagged some of these. “We are planning to award 45-50 construction packages for this project, each package costing around Rs. 400 crore with a length of about 20 km,” said an official.
The Amritsar-Jamnagar expressway is part of the top nine priority economic corridors to be linked through expressways under the Bharatmala scheme.
The expressway would pass through Faridkot, Bhatinda and Abohar in Punjab; Sri Ganganagar, Bikaner, Nagaur and Jodhpur in Rajasthan; and Radhanpur, Samkhiyali and Jamnagar in Gujarat.
As many as 44 economic corridors have been planned under the ambitious Bharatmala scheme, which will be linked through expressways. The government intends to facilitate seamless trade by reducing the distance between cities, saving cost, time, and fuel.
The other corridors include Delhi-Vadodara, Chennai-Salem, Ambala-Kotputli and Raipur-Visakhapatnam.
Earlier this week, the NIIF announced foray into the highway sector by partnering the Ministry of Road Transport and Highways and the NHAI.
It is learnt that the NIIF would invest Rs. 15,000-crore equity in the Delhi-Mumbai expressway project. This investment would be leveraged to raise close to Rs. 50,000 crore in debt. The project cost is Rs. 70,000 crore where the entire construction risk would be borne by the NHAI.
This arrangement essentially means that the ownership of the project would be with the NIIF. At present, the Abu Dhabi Investment Authority is a partner with the NIIF, which was formed by the Indian government as a private entity.
The proposed Delhi-Mumbai expressway would also be connected to the industrial city of Indore and an arm of the erstwhile Golden Quadrilateral.
To fund the ambitious highway building plans, including Bharatmala, the NHAI also plans to mobilise Rs 75,000 crore from the market this fiscal year.
InvITs in 2-3 months
NHAI Chairman N N Sinha recently said the authority would float its infrastructure investment trust (InvIT) in two-three months. “This is the first time we are attempting something like this (InvIT), so cannot say firmly when the trust will take shape. We expect to get Cabinet approval in two to three months and implementation will take four to five months,” said Sinha at a PHDCCI conference.
He said the NHAI board has already approved the InvIT and talks are on with the market regulator for its approval.
InvITs are instruments on the pattern of mutual funds and are designed to pool small sums of money from a number of investors to invest in assets that give cash flow over a period of time.
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