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National Highways Authority of India has formed a Special Purpose Vehicle (SPV) Company for financing, construction and operation of the Delhi-Mumbai ‘Greenfield’ Expressway.
The project has a capital cost of ₹82,514 crore which includes land acquisition cost of ₹20,928 crore. The authority has decided to invest the full equity and proceed with the development.
“This is the first time that NHAI will raise funds specifically for a project, in which it has put in equity,” said government sources. The lenders will have clearer visibility about the way funds are being spent. The proposal is already with the Road Ministry.
The SPV shall raise debt on its balance sheet, while NHAI retains the operational control during construction and Operations and Management. The SPV has been registered by the name of ‘DME Development Ltd’ and will be wholly owned by NHAI.
Toll collection
In addition, the toll on the projects housed in SPV shall be collected by NHAI and SPV shall get the annuity payments without any construction and tolling risks. The completion of the Expressway is projected by March 2024. The corridor will be completely access controlled with a closed tolling. The Road Ministry has been inviting private and public investors to set up logistics parks and fuel stations.
NHAI plans to form similar SPVs for other high value highway projects, an official release said.
This will further enhance NHAI’s capabilities to execute large scale infrastructure projects of national importance.
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