NHAI to Raise Bond Targets to Fund the Bharatmala Project

 In October 2017, the Government of India announced an umbrella program for the highway development of the nation, called the Bharatmala Program. Focusing on enhancing the efficiency of the traffic movement on the roads by building better infrastructure, the Bharatmala Program is the second largest highway development program since the National Highways Development Project (NHDP) in 1998. With the implementation of the program, the country will be getting 50 national corridors as compared to the 6 existing corridors. According to Shri Nitin Gadkari, Minister of Road Transport & Highways, Shipping, Water Resources, River Development and Ganga Rejuvenation, with the Bharatmala Program, 550 districts will be interconnected all over India. The Bharatmala Program has been assigned to the National Highways Authority of India.

The Bharatmala Program has been received with great enthusiasm and has been garnering significant financial support. However, NHAI has decided to hike the alloted bond target of the project for FY19 to keep the project going. The original target for the budget was finalized at Rs 62000 crores, Rs 52000 crores of which have already been raised in FY18. The Bharatmala Program is scheduled to build up approximately 60000 km of new national highways throughout the country, having an outlay of Rs 6.92 lakh crores.

The Project is will be auctioned off in 4 packages or phases, phase I of which has already been auctioned off in March 2018. Phase I covers a stretch of 9 national highways. Mr Gadkari said that the Ministry shall be awarding 50% of the projects under Phase I by the end of this year. He also stated that a Detailed Project Report for the Bharatmala Program is under progress, based on which the amount by which the bond target would be incremented is to be decided, which also includes an estimated cost of the required lands. The completion of the DPRs and the final estimation of the new bond target is expected by August.

Under the Phase I of the Bharatmala Program, the project will be receiving Rs 2,37,024 crores from the Central Road Fund, which is a non-lapsable fund created under Section 6 of the Central Road Fund Act, 2000 out of a cess/tax imposed by the Union Government on the consumption of Petrol and High Speed Diesel to develop and maintain various road, highway and bridge structures throughout the country, Rs 59,973 crore as Gross Budgetary Support, which includes the tax receipts and other sources of revenue raised by the Government, Rs 34,000 crore through proceeds from toll-operate-transfer (TOT), an initiative taken by the NHAI to put its operational highway stretches on auction, and Rs 46,048 crores as toll permanent bridge fee over a period of 5 years.

Currently, NHAI is utilising the TOT funds, a total of Rs 9,681.5 crores, for building 648 km of highways throughout Gujarat and Andhra Pradesh.