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NEW DELHI : India’s first ever Surety Bond insurance product is going to be launched on December 19 to boost liquidity in the infrastructure sector said Minister of Road Transport and Highways Nitin Gadkari. 

Speaking at the CII Global Economic Policy Summit, the minister said that the surety bonds will boost liquidity in infrastructure sector by freeing the contractors’ working capital stuck in bank guarantees.

He added that highway project developers were facing difficulties in getting bank guarantees for their projects and this is going to give good relief to the contractors.

Gadkari also said that the Ministry will launch India’s first insurance scheme for providing guarantee for construction projects.

This announcement comes in the backdrop of India looking to build 26 Expressways, multimodal logistics parks, funicular railway in Ladakh, 35 multimodal logistic parks, 670 wayside amenities, 28 emergency landing facilities and 260 ropeway and cable cars, among others.

India has seen a sharp increase in highway development to 1.47 lakh km up sharply from 91,000 km in 2014. 

Gadkari called for developing indigenous, affordable models of construction without compromising on quality. “We have to improve quality and reduce the cost," said the Minister, adding that ethics, ecology and environment should not be compromised. A project to develop bio-bitumen is underway using rice straw that will replace the imported bitumen used for constructing roads.

 “Robust infrastructure is the backbone of the economy. In this direction, the Government of India has launched the PM GatiShakti to promote integrated infrastructure development," he said as he invited investors to participate in building infrastructure assuring them that they will be given all regulatory clearances on time.

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