National Highways Authority of India (NHAI) on Monday inked a deal with quasi-sovereign wealth fund National Investment Infrastructure Fund (NIIF) to fund large greenfield road projects, which will be executed by the highway authority in the future.
In 2015, Centre had set up NIIF to fund commercially viable greenfield, brownfield and stalled projects, thereby giving boost to the country’s infrastructure sector.
“This arrangement of innovative alternate source of funding is being looked into by NHAI to attract international investors and fund houses who are willing to invest in road projects in India but not very keen to take risk related to the project execution," the road transport and highway ministry said in a statement.
Such an arrangement is expected to bring huge investment at an economical rate for the development of highways in the country. Besides, it is expected to ease stress of borrowing on NHAI’s balance sheet.
“NHAI is raising finances for its mega projects, and is not dependent only upon budgetary support. Several funding models were adopted in the past towards this, which have yielded good results. The MoU with NIIF will provide innovative financial models including for the 24,000 km ₹7.5 lakh crore Bharatmala Pariyojana," Road, Transport and Highways minister Nitin Gadkari said.
Gadkari exuded confidence that the road sector can contribute in a big way in achieving Prime Minister’s vision to make India a $5-trillion economy in the next five years.
PTI also contributed to the story