Deepak Parekh joins NHAI InvIT Selection Committee
National Highways Authority of India (NHAI) has a mandate to develop 34,800 km (including 10,000-km residual NHDP stretches) highway projects under the first phase of Bharatmala Pariyojana. As it is increasingly awarding projects though the engineering, procurement and construction (EPC) route, where it is to bear all the expenses, NHAI needs additional funds
It has now has set up a 4-member search-cum-selection panel, comprising HDFC chairman Deepak Parekh and former highway secretary Sanjay Mitra, to appoint a chairman and two independent directors, to manage its Infrastructure Investment Trust (InvIT).
The other members of the committee are ICICI Bank chairman Girish Chandra Chaturvedi and NHAI chairman Dr Sukhbir Singh Sandhu, who is also the convenor. NHAI is in the process of setting up an InvIT. As a part of the process, a new company is being set up to act as the investment manager to the proposed InvIT. The Cabinet had in December authorised NHAI to launch InvITs to enable it to monetise national highways that have a toll collection track record of at least one year.
NHAI aims to launch the first InvIT in the first quarter of 2020-21 with the aim of raising `5,000-6,000 crore. This will be the first InvIT to be sponsored by any government or semi government entity in the country.
The idea is to set up a competent entity of experts that can professionally run the infrastructure trust to mobilise resources from the market for monetising completed highway projects of NHAI. NHAI needs additional funds as it is increasingly awarding projects though the engineering, procurement and construction (EPC) route, where it is to bear all the expenses. It is in dire need of funds to finance its burgeoning debt, which reached Rs 2.28 lakh crore by the end of February 2020. Analysts estimate NHAI’s borrowings to go up to Rs 3.31 lakh crore by FY23.