BharatMala Pariyojana Current Affairs - 2020
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Union Cabinet approved the proposal of Union Ministry of Road Transport and Highways (MoRTH), which authorizes National Highways Authority of India(NHAI) to set up Infrastructure Investment Trust(s) (InvIT) as per InvIT Guidelines issued by Securities and Exchange Board of India (SEBI). This will enable NHAI to monetize completed National Highways that have a toll collection track record of atleast 1 year and the NHAI reserves the right to levy toll on identified highway.
NHAI’s InvIT will be established as a Trust, named as ‘InvIT Trust’. InvIT Trust will be under Indian Trust Act, 1882 and Securities and Exchange Board of India (Infrastructure Investment Trusts) Regulations, 2014. It will be formed with an objective of investment primarily in infrastructure projects (as defined by Union Ministry of Finance) and may hold assets either directly or through an Special Purpose Vehicles (SPV) or a holding.
Infrastructure Investment Trust(s) (InvIT) as an instrument provides greater flexibility to investors and is expected to create following opportunities-
- It would generate specialized Operation and Maintenance (O&M) Concessionaires.
- It would attract patient capital (for about 20-30 years) to Indian highway market, as these investors are unwilling towards construction risk and are interested in investment in assets which provide long-term stable returns.
- Retail domestic savings and corpus of special institutions such as mutual funds, Pension Fund Regulatory and Development Authority (PFRDA), among others, will be invested in infrastructure sector through InvIT.
Roads and highways are the lifeline of the economy, therefore, development of National Highways has a multiplier effect in terms of facilitating trade and enhancing overall economic development of a region. In October 2017, Union Government launched its flagship highway development programme called Bharatmala Pariyojana, for development of 24,800 km of roads for a total investment of Rs. 5,35,000 crore.
Tags: BharatMala Pariyojana • Infrastructure Investment Trust • InvIT Trust • Ministry of Road Transport and Highways • National Highways Authority of India
The Union Government has announced to build 83,677km of roads, highways, greenfield expressways and bridges with investment of Rs.6.92 lakh core in next five years i.e. by 2022 to further optimise efficiency of movement of goods and people across the country. It also includes first phase of new umbrella programme BharatMala Pariyojana that involves construction of 34,800 km highways by 2022.
It was announced as part of massive Rs. 9 lakh crore package to give a fillip to economy which also includes Rs. 2.11 lakh crore for bank recapitalisation to revive investments as well as growth. It will generate 14.2 crore mandays of jobs.
The BharatMala project will include economic corridors (9,000 km), inter-corridor and feeder route (6,000 km), national corridors efficiency improvement (5,000 km), border roads and international connectivity (2,000 km), coastal roads and port connectivity (2,000 km) and greenfield expressways (800 km).
Further, remaining road projects of 10,000 km under National Highways Development Project will form a part of programme. Government has identified new routes between economically important cities that will be 20% longer in terms of distance but take relatively less travel time.
Under programme, roads will be built along borders with Bhutan and Nepal, bottlenecks on existing Golden Quadrilateral highway network will be removed. Moreover, road connectivity to small industries will be ensured and manufacturing centres will be connected with national highways.
Execution Authorities: The project will be executed through Ministry of Road, Transport and Highways (MoRTH), NHAI, National Highways and Infrastructure Development Corporation Limited (NHIDCL) and State Public Works Department (PWDs). The Centre has set a target for completion of projects in next five years.
Funding: The BharatMala project will be funded in three-pronged manner – market, private investment and asset recycling of NHAI’s toll assets. Of total Rs.5,35,000 crore, Rs, 2.09 lakh crore will be raised as debt from market, Rs 1.06 lakh crore will be mobilised through public-private partnership (PPP) mode and remaining Rs. 2.19 lakh crore will flow from accruals of Central Road Funds, Toll-Operate-Maintain-Transfer monetisation proceeds and toll collections.
Tags: BharatMala Pariyojana • Economy • Government Schemes • Highways • Infrastructure