Talks have been initiated with Japanese lending agencies for funding, highway projects which involves adding more than Fifty Thousand kilometers within next five year.
Nitin Gadkari, Road Transport and Highway Minister, happened to have discussion with representatives of Japan Bank for International Corporation (JBIC), last month requesting to increase lending to India. “We want funding on soft terms for highways and express way projects,” said a senior official of ministry.
The country is in need of Rs.5 lakh crore in the coming five years, so that it can facilitate expansion work on highways. The existing length of highways in India is less than One lakh kilometers, which would be extended to 1.5 lakh kilometer as per the predetermined target of ministry. In addition, there are plans to construct nearly 10 green field expressways in India, which will stretch to 16 thousand kilometers.
Jaijit Bhattacharya, partner-infrastructure at KPMG India said “The key issue with infrastructure in country right now is unavailability of funds. PPPs (public-private partnerships) are yet to pick up and expressways anyway are much more capital intensive than highways.”
JBIC is a major agency for providing funding for large infrastructure projects, and it will positively offer a big push to India’s roads sector, added Bhattacharya.
The bank has already made noteworthy commitment to a number of power projects in India, and freshly to build Andhra Pradesh’s new capital in Amravati.
JBIC also holds equity in the Delhi-Mumbai industrial corridor project.
Gadkari detailed to JBIC steps that the NDA government has taken to perk up stuck road projects. Over 283 stuck roads projects worth about Rs 3 lakh crore have put on stream. Upcoming highway projects offer a huge investment opportunity, the official said, citing the government’s pitch to the lending agencies.