 "Gadkari, Jaitley to meet bankers to revive stalled projects")
With an objective to pull stalled road projects back on track, Union minister for Road, Transport and Highways Nitin Gadkari and Finance Minister Arun Jaitley will meet bankers and concessionaires on Thursday (January 28).
Sources added that around 40 banks, including private and public sector, that have exposure in the infrastructure sector are likely to attend.
Sources added Gadkari would seek feedback from bankers on funding stalled highway projects.
"Although the Cabinet approved a one-time fund infusion scheme for BOT(Toll) and BOT(annuity) projects where 50 per cent work is complete last year, bankers were uncomfortable with the scheme as they wanted the first charge on a stuck highway project. While, National Highways Authority of India (NHAI) wanted to have the first right," said a source.
The ministry is seeking one-time special dispensation from Reserve Bank of India (RBI) so that projects for which one-time fund infusion is required are exempted from asset classification and provisioning norms as contained in RBI circular dated July 1, 2015.
They are also seeking recovery of one-time NHAI assets on a pari-passu basis (which would inter-alia mean repayment period to be coterminous with repayment period of senior debt and sharing of toll receivables/annuities between NHAI and lenders on pari-passu basis) including any shortfall therein.
Sources added that around 40 banks, including private and public sector, that have exposure in the infrastructure sector are likely to attend.
Sources added Gadkari would seek feedback from bankers on funding stalled highway projects.
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According to the sources, there are 19 projects with a total cost of Rs 16,100 crore that have been stalled for various reasons. With the projects missing deadlines, cost has escalated to about Rs 21,000 crore.
"Although the Cabinet approved a one-time fund infusion scheme for BOT(Toll) and BOT(annuity) projects where 50 per cent work is complete last year, bankers were uncomfortable with the scheme as they wanted the first charge on a stuck highway project. While, National Highways Authority of India (NHAI) wanted to have the first right," said a source.
The ministry is seeking one-time special dispensation from Reserve Bank of India (RBI) so that projects for which one-time fund infusion is required are exempted from asset classification and provisioning norms as contained in RBI circular dated July 1, 2015.
They are also seeking recovery of one-time NHAI assets on a pari-passu basis (which would inter-alia mean repayment period to be coterminous with repayment period of senior debt and sharing of toll receivables/annuities between NHAI and lenders on pari-passu basis) including any shortfall therein.