NHAI to raise Rs 1,000 crore via green bonds for Delhi-Mumbai Expressway

The National Highways Authority of India (NHAI) will look to raise Rs 1,000 crore for the Delhi-Mumbai Expressway by issuing green bonds through its arm, DME Development.

 

The highway authority said on Thursday that it will raise funds for implementing environment-friendly measures on the Delhi-Mumbai Expressway project.

 

“To be held under a closed bidding system, the aggregate total size of the issue will be up to Rs 1,000 crore, with a base issue size of Rs 500 crore. There will be a green-shoe option to retain oversubscription up to Rs 500 crore. The first-of-its-kind green bond issue in the roads and highways sector is expected to be launched in the second week of December 2024 and will be completed with strict compliance to the Government of India’s sovereign green bonds framework, international protocols, and Sebi guidelines,” a statement by the Ministry of Road Transport and Highways said.

   

The funds will be used for expenditure on avenue plantation, median plantation, construction of animal underpasses, natural stormwater drainage, streetlights powered by renewable energy (solar), waste recycling and reuse, and rainwater harvesting along the costliest expressway in the country.

 

According to Santosh Kumar Yadav, chairman of NHAI, the green bonds will help encourage investment in eco-friendly projects, especially in the roads and highways sector, and will facilitate long-term cost savings by reducing energy consumption and lowering the impact of vehicular emissions on the environment.

 

The special purpose vehicle of NHAI, DME Development, raises debt against the future proceeds of the ambitious highway project, a method known as toll securitisation.

 

DME Development aims to raise about Rs 48,000 crore from banks and financial markets through loans and bonds and has successfully raised around Rs 42,000 crore so far for the implementation of the Delhi-Mumbai Expressway project, NHAI said.