The centre is finalising steeper highway construction targets for the current fiscal 2023-24, in line with plans to boost infrastructure creation, ahead of the 2024 parliamentary elections. A senior Roads Ministry official told ET that highway construction goals for the fiscal are being redrawn after top government functionaries expressed dismay at modest targets. He also said there will be higher retail participation in the coming round of National Highways Authority of India (NHAI) infrastructure investment trust (InvIT) fund raise.
“We are finalising the target of road construction for the current fiscal after undertaking a realistic assessment. We don’t want to be too conservative, but also want to ensure that achievable goals are set,” the official said adding that the goals being fixed will be kept above those for 2022-23.
The centre had targeted developing 12,200 kilometres (kms) of national highways (NH) in fiscal 2022-23. Achievement for the year stood at 10,933 kms, making it the second consecutive year that the country failed to meet highway construction goals. It was earlier expected that the target for highways construction for the fiscal 2023-24 will be kept at around 12,500 kms, but this is now being reassessed.
Commenting on financial health and fund raising avenues for NHAI, the official said that toll income of the highway builder will comfortably be enough to meet debt servicing requirements. “NHAI’s income stood at Rs 41,000 crore in 2022-23 and this will rise to INR 1.25 lakh crore in 2028-29,” he said.
Sharing that the third round of fund raise using InvITs is being firmed up, the official said that there will be higher retail participation this time, “after assessing the demand in the previous round.”
The National Highways Infra Trust (NHIT), a special purpose vehicle (SPV) of NHAI, has held two rounds of fund raise till now. There was no retail participation in the first round while 25% of the offering was earmarked for non-institutional investors in the second round.
In all, NHIT raised INR 1,500 crore in the second round, and aims to corner INR 15,000 crore from InvIT in the current fiscal.
