NHAI should have a financial arm like the Power Finance Corporation of the Ministry of Energy or the Indian Railways Finance Corporation (IRFC) of the railways. he says

NHAI should have a financial arm like the Power Finance Corporation of the Ministry of Energy or the Indian Railways Finance Corporation (IRFC) of the railways. he says

Union Road Transport and Highways Minister Nitin Gadkari said on Tuesday that infrastructure companies should also launch their own non-bank financial companies (NBFCs) to finance road construction projects.

Mr. Gadkari added that the National Highways Authority of India (NHAI) should also have a financial arm like the Power Finance Corporation (PFC) of the Ministry of Energy or the Indian Railways Finance Corporation (IRFC) of the Ministry of Railways. .

“Infrastructure companies are now investing huge amounts of money in infrastructure…Infrastructure companies should also start their own non-banking financial companies (NBFCs) to finance road construction-related projects,” he said. he said at an event in Assocham.

He also suggested that NBFCs that will be launched to fund road projects should partner with foreign funds to reduce the risk of hedging the dollar, and they can also mortgage tolls.

Mr. Gadkari stressed that there is a need to develop an innovative financial model for the road sector as it is difficult to develop infrastructure solely with public funds.

He also observed that the Ministry of Road Transport and Highways (MoRTH) had a road length of 1 lakh km, which had an internal rate of return of over 13%.

According to the Minister, MoRTH is also considering a proposal to create a dedicated agency that will buy out or restructure stalled projects.

He said that due to the war between Ukraine and Russia, inflation had increased.

The minister noted that a few years ago, projects related to road infrastructure were delayed due to delays in land acquisition and environmental clearances.

“But now the situation has improved,” he said.

Mr. Gadkari claimed that India’s road infrastructure would be on par with that of the United States by 2024.


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