Union minister Nitin Gadkari on Monday said government wants to take the National Highways Authority (NHAI) public and is working on the same.
“It (NHAI IPO) is in the process now. I’m thinking, but I need approval from the finance ministry,” he said without spelling out details like the timing, maintaining that “it is in the process”.
The department of investment and public asset management in the finance ministry looks at divestment processes.
Addressing an event by the Indo-American Chamber of Commerce, he made a passing reference to listing NHAI and added that government is confident of getting investor subscriptions of up to Rs 10 trillion.
The remarks were in the backdrop of impressive investor response to the Rs 1,560-crore IPO of Cochin Shipyard, that was over subscribed 76 times recently.
Reiterating that he wants to use public money to build infrastructure, especially if banks are reluctant to do so, Gadkari said senior citizens can be given an additional coupon of 0.5 per cent.
Last week he had said he was against using foreign funds to build large infra projects but wanted to scoop up funds from the common-man.
Making public his reservations with bankers, who he claimed are taking up to 12 months for financial closure of a project, Gadkari said the NHAI has enough money to undertake projects by itself in the EPC mode.
Conceding that there were difficulties in the past like NPAs, he asked banks to be more forthcoming and look at projects in a newer way. “I like people who commit mistakes. I dislike honest people who don’t want to take a decision.”
The ministry has gone for the EPC mode in the Rs 44,000-crore Mumbai-Vadodara Expressway project, he said, asserting that there is no dearth of funds for such projects. The minister, however, said PPS or build operate transfer routes is the ideal way to do infra projects.
Gadkari said the roads ministry will start using the TOT (toll operate transfer) in about six months and start a pilot project under the architecture in a month. However, when it comes to infra projects, road transport is the last priority in the scheme of things, he said, adding the first choice is water and then rail.
He said if auto sales continue to grow at the current pace, government will have to build an additional lane in the over 2 lakh km NH network every three years, which will entail an investment of Rs 80,000 crore. Traffic on the road is very high and the minister said running public transport on electric motors is the need right now.
He said government is planning to start 30 rural connectivity projects at an investment of Rs 8 trillion, of which five will begin in three months. It has already given out works of over Rs 5.6 trillion on roads and another Rs 3 trillion are in the pipeline, he said.
He also rued that land acquisition continues to be a problem when it comes to road building. Gadkari also warned cement companies against carterlisation and raising prices, saying there’s a pending proposal to increase output through ten state-run plants which can be activated.
Stating that only a few of the many investor delegations he meets actually invest, Gadkari urged them to be more active.
Gadkari said despite a slew of sops, he cannot understand the reasons for low response from companies for investing in cruise tourism. Pointing to the case of an amphibious ship that has not rolled off for six months due to want of court permissions to build a landing ramp, he said public support and an attitude for development is essential.
In Maharashtra, the roads ministry has undertaken projects worth Rs 3 trillion in the last three years, saving Rs 5,000 crore, by liberalising tender Norma, he said.
Later addressing the Progressive Maharashtra event, Gadkari, who also heads the Union shipping ministry, said the nation’s largest container terminal JNPT to book a profit of Rs 2,000 crore this fiscal year.
Overall, he expects the 12 major ports that his ministry administers, to report an annual profit of Rs 7,000 crore this financial year, up from Rs 5,000 crore in FY17.