HindustanTimes Fri,19 Sep 2014

Govt to tap foreign investment for Rs. 25,000-cr expressway projects

Anupama Airy and Moushumi Das Gupta, Hindustan Times  New Delhi, January 23, 2014
First Published: 23:44 IST(23/1/2014) | Last Updated: 23:48 IST(23/1/2014)

Apprehensive that the slump in the Indian market may not get many domestic companies to bid for its ambitious expressway projects, the government is now eyeing foreign investment in three of its big-ticket expressway projects costing about Rs. 25,000 crore.

These include the 135-km Eastern Peripheral Expressway, 64-km Delhi-Meerut and 379-km Mumbai-Vadodra expressways.

In a recent meeting, highways secretary Vijay Chhibber had told his officials to tap major foreign players from countries like Japan, China, Malaysia, Australia and others for these projects.

"Despite relatively higher returns, the response of Indian banks and industry has not been forthcoming …so we have decided to attract foreign equity as Indian equity is drying out for the projects," a senior official from the ministry of road transport and highways told HT.

As part of this initiative, the ministry has decided to extensively market these projects abroad.

"Since the concession period for the projects was 30 years and since the projected traffic would also be sufficiently high, we expected good participation ...but given the lukewarm response of bankers, currently undergoing bidding, and even with relatively higher IRR (internal rate of return), it has been decided that before bidding, there should be extensive marketing of projects in global markets," the official said.

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