NEWS : INFRASTRUCTURE
monetisation through the toll-operate-transfer
(TOT) route and the remaining Rs.1,06,000 crore
through private sector participation. Therefore,
success of TOT model is significant. A majority of
the Bharatmala programme is expected to be
undertaken through NHAI. While the NHAI
borrowing programme is on track, the budgetary
allocation in the last two budgets was lower than
required , thereby necessitating dependence on
other funding avenues
Success of TOT critical for meeting
funding requirements for Bharatmala:
ICRA
The government’s asset monetization programme
for the roads sector must take off for plugging the
shortfall in budgetary allocation and success of
the ambitious Bharatmala programme for
highways development. The success of the third
round of Toll-operate-Transfer (TOT) bundle will
define the feasibility of the model introduced in
2016 for monetization of publicly-funded
highways. Under the TOT model, investors make
a one-time lump sum payment in return for long-
term toll collection rights. funds will have to be met
through additional borrowings, thereby increasing
the debt burden for the national highways
authority of India (NHAI). Hence, success of the
TOT as a model will be significant.
NHAI invited bids for the third bundle of TOT
projects last week. With the floor price set at
around 5,000 crores, the success of the new bid
assumes significance as the response to the
second round of TOT auctions remained tepid.
The second round of bids were cancelled in
February this year. The authority’s first round of
TOT auctions concluded in February 2018,
however, garnered Rs. 9,681 crore, as against a
base value of Rs. 6,258 crore. The overall funding
requirement for the new highway development
programme is estimated at Rs.6,92,324 crore,
which is proposed to be funded through budgetary
allocations of Rs.3,43,045 crore over FY2019-
FY2022, market borrowings of Rs.2,09,279 crore,
Rs. 34,000 crore through proceeds of
PAGE 10 I METROBERRY I JULY 2019
We must look at innovative sources of
funding for infrastructure: Nitin
Gadkari
The ministry of road transport and highways is
looking at alternative and innovative sources of
funding as financing from banks is becoming a
challenge. Gadkari said that his ministry has been
doing well irrespective of any dedicated finance
arm as compared to those for sectors like railways
and power. Around Rs. 17 lakh crore has been
invested in roads, shipping and highways sector
over the last five years. "We must look beyond
banks for financing. There is huge potential for the
sector to generate employment and fuel the
economic growth of the country.
NHAI in talks to make BOT projects
attractive
Rebooting the BOT move is part of the govt plan to
revive the framework which has failed to woo
private firms that were exposed to more risks. The
National Highways Authority of India (NHAI) is
looking to tweak the build-operate-transfer (BOT)