NHAI pauses fund raise; to focus on improving BOT model to entice investors, says MoS Harsh Malhotra, ETInfra

Time of India

17-07-2025

NEW DELHI: Alarming debt levels have led the National Highways Authority of India (NHAI) to pause fund raise and the high
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way developer is refining the Build-Operate-Transfer (BOT) Model to attract investors and lighten its balance sheet, a senior government official has said.'We have been able to cut down about ₹85,700 crore of NHAI debt and we are improvising the BOT Model so that the debt level further comes down. Additionally, we have decided not to raise further loans. The roads and highways which have already been constructed, we have plans to remonetise them,' said Harsh Malhotra, Minister for Road Transport and Highways, in an interview to ET Infra.Due to extensive road development undertaken by NHAI primarily through borrowings, the authority's debt had risen to about ₹3.4 lakh crore, raising concerns about implications of massive debt on its books.Under a Build-Operate-Transfer (BOT) Model, a private developer is responsible for financing, building and operating a project for a specific concession period in which developer is allowed to recover the development investments by way of user charges or tolls charged. Under such a model, the financial burden on the government is limited. However, the model fell out of favour due to land acquisitions, financial risks faced by private developers.Due to lukewarm response to BOT Model, in the past several years, the government has resorted to Hybrid Annuity Model (HAM) and Engineering, Procurement, and Construction (EPC) Model of road development, in which the government partly or fully takes up the financial burden.Malhotra highlighted that the next phase of road development by the central government will be focused on developing 40,000 km of high-speed corridors which will enable vehicle speed of up to 120 km/hr.According to the NHAI, the country has about 63 lakh km of road network, of which 1.46 lakh km are national highways on which 50 per cent of India's traffic is transported.'By 2034, development of almost 40,000 km of high-speed corridors is being aimed which can enable vehicles to run at a speed of 100 km/hr to up to 120 km/hr. The Ministry of Road Transport and Highways' vision for 2047 envisages interstate connectivity and economic corridors which connect states and industrial corridors. Highway speed along with economic growth is the vision of the government,' said Malhotra.As per the ministry, as of February 2025, 6,669 km length of high speed greenfield corridors have been awarded with construction completed for 4,610 km.One of the major ongoing projects is the Delhi-Mumbai Expressway, which when completed is expected to reduce the travel time between the two cities from 32 hours to about 12 hours.'The Delhi-Mumbai Expressway is being constructed at a cost of ₹12,500 crore and once completed, it will enable the travel between the cities within 12 hours and will have amenities for travelers after every 100 km,' said Malhotra.Apart from high-speed corridors, the ministry is also focused on developing bypasses or ring roads around major Indian cities in order to enable smooth movement of traffic.'A quadrilateral highway connecting the cities of Chitrakoot, Ayodhya, Varanasi, and Gorakhpur is being constructed. The road will touch the cultural sites. In the future, for all major cities such as Indore, Guwahati and others, bypasses or ring roads are being planned,' said Malhotra.Malhotra, who is a member of Parliament from Delhi, outlined that in order to smoothen the traffic to and from Delhi International Airport, the ministry has proposed the development of a 7-km long underground tunnel.'We have proposed constructing a 7 km long tunnel linking Delhi's Nelson Mandela Road with Urban Extension Road-II in order to smoothen the traffic flow to and from Delhi International Airport,' said Malhotra, adding that several road development projects are underway which will ensure traffic from neighbouring states do not enter the capital and congest the city.Under NHAI, a 76 km long Urban Extension Road-II is also being developed, which will divert heavy traffic from neighbouring states away from the national capital.
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