NHAI to take measures to help the stressed projects
R.P. Singh the chairman of NHAI and his team have come up with some proposals to revive the stressed road ways projects. The board of National Highways Authority of India (NHAI) on Thursday approved a proposal to set up an asset reconstruction company (ARC) to revive the stressed projects.
Singh also stated that an asset management company (AMC) will be formed in which NHAI will have a 25 % stake. The remaining 75 % stake will be offered to the financial institutions. Singh also maintained that NHAI will soon have detailed discussions with the Indian Banks’ Association (IBA). He was of the opinion that a strategy for the ARC should be drawn up to decide how the assets should be taken over.
Singh also stated that the draft for this proposal is not yet complete and the corpus for the ARC had not been decided. Experts say once the ARC takes over an asset; it will either complete the project on its own and recover the investment by tolling or divest it.
They will keep a provision that in cases where the construction has not started at all, the ARC could even bid out the project afresh. The idea is to speed up construction of stuck projects and provide comfort to the lenders. The team does not want these stressed projects to be declared as non-performing assets (NPAs) by the lenders. The board approved the proposal following the endorsement by the IBA and the department of financial services. Now the wait starts for the implementation.
Source- The Financial Express
Asset Management Company, Indian Banks' Association, National Highway Authority of India (NHAI), NHAI, NHAI projects, Non-performing assets
