NHAI in sound financial health; Chairman refutes fund crunch reports

The Chairman of the National Highways Authority of India (NHAI), NN Sinha, has dismissed media reports that NHAI is facing a financial crunch with contingent liabilities to the tune of ₹3 lakh crore. He said that either people do not understand what contingent liability is or the numbers are misleading and misreported. Contingent liability is uncertain in nature, he clarified at a recent CII event. As a matter of fact, the assessment depending on the payout ratio, doesn't see that much number happening, and that the total amount of claim on NHAI on account of arbitration is about ₹70,000 crore. He added that NHAI's books are in the open and anybody can verify the facts. NHAI is on its way to construct more than 1,000 km of new highway projects compared to last year and spending was going to be more rather than less and there should be no concerns on this score. Allaying concerns on whether the authority will be able to take up projects other than on the BOT toll mode, he said that NHAI appraises projects on the basis of viability. About 4,140 km projects meet 9 percent or more level of returns and this does not include greenfield projects as the traffic numbers are uncertain. All projects will not fit into BOT as there are a variety of implementation approaches as under Bharatmala Program itself about 60 percent of the projects will be funded under HAM; 30 percent on EPC mode; and the remaining10 percent on BOT. Greenfield projects like Vadodara-Mumbai Expressway may be executed under EPC, and some on HAM. NHAI will request the government for more budgetary resources and is also mobilizing funds from the market, besides its revenue stream from highways construction. It is also awaiting Cabinet approval for floating an Infrastructure Investment Trust (InVit) by the end of this year.