Banks worried: Pink City Expressway to turn into an NPA
The lenders of the Pink City Expressway are worried as they fear that their project will be soon turning into a non-performing asset (NPA). The Highway Ministry joining hands with the National Highways Authority of India (NHAI) has ordered the banks to replace the developer; else they will cancel the Gurgaon-Jaipur highway project.
Close to 12 banks, led by IDBI, have an exposure of about Rs 1,600 crore in the Gurgaon-Jaipur national highway project. However they fear that the project will be termed as an NPA even if they agree to a via-media being proposed by the NHAI.
NHAI gave the “intention to issue termination notice” to the developer of Gurgaon-Jaipur highway on account of poor maintenance and slow progress of work. The developer is facing a fund crunch which has resulted in the developer collecting toll from the users of an unfinished road. This money is used to repay interest to the lenders. The project is stalled due to all these irregularities and liquidity crunch.
The banks have lack of agreement on how to deal with the Rs 1,600 crore exposure. However it is the common man who always suffers and the road users are paying tolls for an incomplete stretch of road.
According to the Government estimates, this project is expected to cost another Rs 500-Rs 600 crore for finishing the work.
Source- The Hindu Business Line
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