The National Highways Authority of India (NHAI) has raised a Rs 8,500-crore long-term loan from LIC for 30 years, at an interest rate of 7.2%, taking its total borrowings so far in the current fiscal to Rs 23,520 crore against the limit of Rs 59,279 crore.The highways development authority has already borrowed Rs 10,000 crore through taxable bonds from the Employees’ Provident Fund Organisation (EPFO) and Rs 5,020-crore private placement to banks and financial institutions.
“We hope to raise another Rs 23,520 crore in the remaining period of the current fiscal. However, it would be purely need-based. The avenues have not been finalised yet. We are scouting for sources which can give us the optimal rate,” NHAI’s member (finance) Rohit Kumar Singh told FE. Last fiscal, NHAI had raised R19,000 crore through taxable bond and R5,000 crore through tax-free bonds.
Sources said the ministry of road transport and highways has sought a borrowing limit of close to Rs 60,000 crore for NHAI for 2017-18, roughly the same as the ceiling for the current year, in the upcoming Budget Borrowings apart, NHAI’s major source of funds is the highway cess, the proceeds from which would go up from Rs 9,566 crore in 2014-15 to Rs 25,356 crore in 2017-18. It also hopes to plough back tolls collected from projects to the tune of Rs 8,596 crore in 2017-18 for building new highways.
NHAI had awarded 4,344-km highway projects in 2015-16 and 3,067 km in 2014-15. In 2014-15 and 2015-16, NHAI had constructed 1,501 km and 1,987 km, respectively. The road transport and highways ministry has asked NHAI to award 15,000 km and construct 8,000 km of highways in the current fiscal.
NHAI awards projects only after acquiring 90% of the required land. NHAI acquired 9,000 hectares of land in 2015-16 against 6,750 hectares in the previous year. For the current fiscal, it is targeting to acquire 10,000 hectares.
The cost of land acquisition stands at an average of Rs 2.13 crore per hectare compared with Rs 1.35 crore per hectare in the last fiscal. Land acquisition now accounts for 40-45% of the total project cost.
In 2014-15 and 2015-16, NHAI had constructed 1,501 km and 1,987 km, respectively. Road transport and highways minister Nitin Gadkari has set ambitious targets of awarding highway projects of 25,000 km and building 15,000-km long roads during 2016-17.