Gadkari to meet bankers, road contractors on stalled projects on Jan 28

In order to discuss the issues related to the funding of highway projects, Road Transport and Highways Minister Nitin Gadkari will meet the bankers and the road contractors on January 28. Gadkari has also urged Finance Minister Arun Jaitley to attend the meeting. In the meeting the ministers will discuss the issues related to 19 stuck highway projects and also seek feedback on funding future highway projects.

The highway projects are stuck due to various reasons such as cost escalation, unviability of projects and row between bankers and concessionaires. The cost of these stalled projects, which are threatening to pile up the non-performing assets of banks, is at least Rs 30,000 crore. Some of these projects need special mediation between banks and concessionaires as cost escalation has been as much as 30 per cent. Furthermore, the government is also looking to set up a high-powered committee with the approval of the Cabinet to look into projects that have not been resolved through the Cabinet Committee on Investment (CCI) or the Cabinet Committee on Economic Affairs (CCEA).

Earlier this month, with a view to fund its highway expansion plan in the financial year 2016-17 beginning April 1, Road transport and highways ministry has sought Rs 80,000 crore from the finance ministry; the amount is almost double of what the ministry had received in the budget for 2015-16. The ministry is also looking to raise funds through tax-free bonds.