Road panel says NHAI loans should get govt guarantee
The B K Chaturvedi committee set up to recommend ways to implement road projects faster and more efficiently, has recommended that the National Highways Authority of India (NHAI) be given sovereign guarantees on the loans it raises from the market. - IRB Infra bags Rs 800-cr road project from NHAI - Govt to invite bids for three mega road projects by yr-end - Govt may vest ownership of roads with NHAI - Agreements with road contractors may be relaxed - NHAI to employ safety experts, audit on site - Will the new track record norms hurt infrastructure? The move, if the government agrees to it, would reduce the interest that NHAI pays on long-term borrowing by at least 2 percentage points, its officials said. The authority borrows money to finance road projects under an annuity scheme in which contractors build roads for NHAI, which pays them once in six months till the project is complete. NHAI recovers its investments through tolls in such projects. “We get short-term loans at a rate of 8 per cent from banks, which will not change. But long-terms loans, which attract an interest rate of 11.5 to 12.25 per cent, is estimated to come down to 9.5 to 10.5 per cent,” said a senior NHAI official. A sovereign guarantee will also make it easier for NHAI to raise loans from international organisations, the official added. The committee, which submitted the first part of its report to the prime minister last week, has also recommended giving the road transport authority more powers and flexibility to modify the model concession agreement that defines the details of bidding in a public private partnership (PPP) project. As of now, any change in the documents is done in coordination between the Planning Commission and the finance ministry. Prime Minister Manmohan Singh set up the committee under Planning Commission member B K Chaturvedi to resolve various issues leading to delay in road projects. The committee also comprised Finance Secretary Ashok Chawla and Road Secretary Brahm Dutt. The committee will shortly begin work on the second part of the report. This will deal with a new dispute resolution mechanism, providing financing to road builders and making changes in the company law to make the special purpose vehicles more powerful.Quick Loan commented:
They are saying that there should be the government gurantee to these loans that will make them more reliable
10.08.2011
Wealth Transfer commented:
They are saying that there should be the government guarantee to these loans that will make them more reliable
26.08.2011
Paydayloans300 commented:
If there will be guarntee for the people then it will be more conveninet for them to get result out of it
13.09.2011
car hire commented:
The group is of the view that the NHAI must manage borrowings on its own. In case it fails to move up funds in assured cases, it may move towards the finance ministry, which would then believe backing the loan on a case-by-case origin.
30.09.2011
Australian Taxation Services commented:
Many projects from the NHAI have been such a waste of money but now government must see whether the implementation fo this huge money is going to be helpful or not.
15.11.2011
payday loan commented:
Payday loans are really fit for the critical financial situation. When a person needs small cash, then they can apply for payday loan. Payday loans are for emergency.
22.11.2011
Family Offices Hong Kong commented:
The NHAI has been unable to pay their debt many time that\'s why government has to support them for creating the better infrastructure and its nice that you shared this great article with us.
24.11.2011