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NHAI to be flag-bearer of Centre’s asset monetisation plan

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highways

The National Highways Authority of India (NHAI) will be the flag-bearer of the government’s asset monetisation programme with a plan to raise about Rs 30-40,000 crore through monetisation of its operational stretches over the next two years.

The company officials indicated that the disruptions in wake of pandemic delayed some of its asset monetisation plan, but with traffic fast returning to near normal levels now, about Rs 10,000 crore of road assets would be monetised by NHAI in the current year (FY 22) and the exercise would kick up pace next year with doubling or tripling of the numbers in the next few years.

With the country in firm grip of the second wave of Covid pandemic in the months of April and May, and subsequent restrictions on mobility and partial lockdown, tolling at national highways nose-dived. In a report released earlier, rating agency ICRA had estimated that sequentially tolling had fallen by about 10 per cent in April and close to 30 per cent in May. Thereafter, there has been marked improvement in traffic on highways reaching 90 per cent of pre-Covid levels and has crossed that level too now.

An NHAI official said that the entity is in touch with a clutch of investors and soon bids would be invited for taking the operational NHAI project under the toll-operate-transfer (TOT) model.

Under the TOT model, highway projects which have been operational for at least two years, and which have been generating a steady stream of revenue, are to be leased out to large-cap investors for carrying out O&M (operation and maintenance) operations in consideration of the highest bid upfront concession fee. The investor recovers investment through tolls collected for a stretch over a period of concession spreading over 20-30 years. Once the cost with agreed return is achieved, the road returns back to NHAI.

“The national monetisation pipeline announced by the government has identified the road sector having the maximum potential for such exercise at Rs 1,60,000 crore over the next four financial years. This would be achievable given the tested model already available in the sector. Besides, InvIT model would also be used to pool resources and monetise projects,” said a road sector expert asking not to be named.

NHAI has planned an InvIT, the second one promoted by a public sector entity after power transmission utility PGCIL, but it has seen multiple deferments over the Covid disruptions. But a Rs 5,100 crore InvIT is now likely next month.

The InvIT trust will acquire 100 per cent of the equity shares of the project SPV from the sponsor NHAI. It is expected that NHAI may raise further funds, around Rs 5,000 crore, by transferring more assets to the InvIT later in the year.

But TOT may remain the most active model for monetisation. So far NHAI has raised around Rs 17,000 crore through the TOT model by granting on long-term lease three road bundles out of the five attempted so far. The sixth bundle will be out soon.

Another exercise for asset monetisation by NHAI will be through toll securitisation where the authority gets paid for investment in road construction and private investor gets to collect toll.

Proceeds from the asset monetisation programme are used to repay debt and develop highways. As on March, 2021, NHAI had around Rs 3 lakh crore debt. It is permitted to borrow Rs 65,000 crore in 2021-22, same as in 2020-21.

The expectation of asset monetisation (by NHAI and other developers including EPC developers) is also supported by the past performance of road EPC companies. Between fiscals 2016 and 2021, sale of assets to InvITs or to private equity funds helped unlock Rs 80,000 crore of enterprise value for the sector (Rs 50,000 crore for the road EPC companies analysed), according to a Crisil report. Around 60% of this was through four InvITs. The funds released strengthened their balance sheets.

The leverage (calculated as total outside liabilities to tangible net worth) of these companies is estimated to have improved to 1.25 times as on March 31, 2021, from 1.87 times as on March 31, 2016, largely supported by asset monetisation.

The Union Budget 2021-22, laid a lot of emphasis on asset monetisation as a means to raise innovative and alternative financing for infrastructure. In her Budget speech, Finance Minister Nirmala Sitharaman had said that monetising operating public infrastructure assets was a very important financing option for new infrastructure construction. Now a Rs 6 lakh crore monetisation pipeline has been announced for bringing in private investment in brownfield Central government projects in various sectors where assets are idling.

National

After LS nod, Amit Shah to move Immigration and Foreigners Bill in RS today

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New Delhi, April 2: The Rajya Sabha on Wednesday will discuss the Immigration and Foreigners Bill, 2025 which has already been passed by the Lok Sabha.

As per the business list of Upper House, Union Minister Amit Shah will move that the Bill “to confer upon the Central Government certain powers to provide for requirement of passports or other travel documents in respect of persons entering into and exiting from India and for regulating matters related to foreigners including requirement of visa and registration and for matters connected there with or incidental thereto, as passed by Lok Sabha, be taken into consideration.”

He will also seek the passing of the bill after a discussion is held by the members of the House.

A key aspect of the Bill is the implementation of enhanced surveillance and security protocols. The Union Home Minister while speaking about the importance of the bill in the Lok Sabha had said, “It will strengthen the country’s security and economy, pave the way to make our education system and universities global, lay a strong foundation for research and investigation in the country and make India number one in the world in every field by 2047.”

He said that immigration was not an isolated issue but many issues of the country were directly or indirectly linked with it. He said that it was very important for the security of the country to know who is entering our borders, when they are entering, for how long they will stay and the purpose for which they are here.

Also to be tabled in the Rajya Sabha is the Boilers Bill, 2024, returned by Lok Sabha with Amendments. Union Minister Piyush Goyal will move that the amendments made by Lok Sabha be taken into consideration.

Union Minister Manohar Lal Khattar will make a statement regarding the “Status of implementation of the recommendations contained in the Tenth Report (Seventeenth Lok Sabha) of the Department-related Parliamentary Standing Committee on Housing and Urban Affairs on ‘PM Street Vendor’s AtmaNirbhar Nidhi (PM SVANidhi)’ of the Ministry of Housing and Urban Affairs.”

Upper House members Sushmita Dev, Rekha Sharma and Bikash Ranjan Bhattacharya will present the “366th Report (in English and Hindi) of the Department-related Parliamentary Standing Committee on Education, Women, Children, Youth and Sports on ‘Demands for Grants (2025-26)’ pertaining to the Ministry of Youth Affairs and Sports.”

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Business

Sensex plunges nearly 2 pc amid US reciprocal tariff concerns

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Mumbai, April 1: Indian stock markets on Tuesday witnessed a sharp decline on the first trading day of the new financial year. The fall came as investors reacted to global market concerns, especially the upcoming US reciprocal tariffs on April 2.

The Sensex, which represents 30 major companies, dropped by 1,390.41 points or 1.80 per cent to close at 76,024.51. During the trading session, it fluctuated between an intra-day high of 77,487.05 and a low of 75,912.18.

The Nifty index also tumbled 353.65 points or 1.50 per cent, ending at 23,165.70. It touched a high of 23,565.15 and a low of 23,136.40 during the intra-day.

Almost all stocks in the Sensex index ended lower, except Zomato, IndusInd Bank, and State Bank of India (SBI).

The biggest losers included HCL Technologies, Bajaj Finserv, HDFC Bank, Bajaj Finance, and Infosys, which saw their share prices decline by up to 3.66 per cent.

Midcap and smallcap stocks also faced pressure. The Nifty Midcap100 index closed 0.86 per cent lower, while the Nifty Smallcap100 index slipped 0.70 per cent.

The BSE Midcap index was down 0.9 per cent, whereas the Smallcap index managed to rise slightly by 0.2 per cent.

Sector-wise, most indices ended in the red, with IT, real estate, and consumer durables stocks falling by around 2 per cent each. Only media, oil & gas, and telecom stocks managed to stay positive.

Market volatility also surged as the India VIX, commonly known as the fear index, jumped 8.37 per cent to 13.78 points. This suggests that investors are increasingly cautious about the market’s direction.

Analysts suggest that market fluctuations may continue until there is more clarity on global trade relations and economic policies as investors remain concern about Trump’s tariff policies and their impact on international trade.

“Amid heightened global volatility ahead of the anticipated US reciprocal tariff announcement tomorrow (US time), the domestic market witnessed a significant sell-off today. Investors are eagerly awaiting the specifics of these tariffs while also keeping a close eye on ongoing negotiations for a potential Indo-US trade agreement,” said Vinod Nair, Head of Research, Geojit Investments Limited.

The IT sector was among the hardest hit due to its substantial exposure to the US market, and real estate stocks fell following Maharashtra’s upward revision of ready reckoner rates, which affect property valuations.

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National

Bengal minister among 30 TMC MLAs asked to clarify absence on last day of Assembly session

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Kolkata, April 1: The internal disciplinary committee of Trinamool Congress’ legislative party in the West Bengal Assembly has finally shortlisted 30 party MLAs, including a member of the state cabinet for being absent on March 20, the last day of the second phase of the budget session, ignoring the party whip.

The absent MLAs had not even given prior intimation about their absence to the office of the Speaker, Biman Bandopadhyay.

These legislators, including the state minister, will have to personally appear in front of the disciplinary committee this month and justify why internal disciplinary action will not be initiated against them for ignoring the party whip.

The name of Manoj Tiwari, the cricketer-turned-politician and the current West Bengal Minister of State for Youth and Sports Affairs department, also figures in the list of those who will have to justify the reason behind their absence during House proceedings and ignoring party whip, said a member of the disciplinary committee who refused to be named.

Tiwari joined Trinamool Congress in 2021 before the state Assembly elections that year and was elected as a party legislator from the Shibpur Assembly constituency in the Kolkata-adjacent Howrah district. After the new state cabinet was announced, his name figured in the list.

Initially, it was decided that the meeting of the internal disciplinary committee would be conducted on March 29. However, the meeting on that date was cancelled because of the preoccupations of the MLAs including the members of the disciplinary committee because of the Eid festival.

The committee is chaired by the state Parliamentary Affairs Minister, Sovandeb Chattopadhyay. The other members of the committee include the West Bengal Minister of State for Finance (independent charge) Chandrima Bhattacharya, the state Municipal Affairs and Urban Development Minister and Kolkata Mayor Firhad Hakim, state Power Minister Arup Biswas and the chief whip of Trinamool Congress’s legislative party in state Assembly, Nirmal Ghosh.

Trinamool Congress had issued a whip, making the presence of all party legislators mandatory on the last two days of the second phase of the budget session on March 19 and March 20.

Although the presence on the part of the legislators was almost 100 per cent on March 19, several legislators, including the minister, skipped attendance on March 20.

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