Minister of Road Transport and Highways Nitin Gadkari on Tuesday said the government is formulating a model to allow small investors to invest in road projects.
As the Ministry aims to expand India’s national highway network from around 1.40 lakh km to 2 lakh km by 2024, the Minister noted that MoRTH will approach capital markets in September to raise funds for four road projects through Infrastructure Investment Trusts (InvITs) with an investment limit of ₹10 lakh for retail investors.
“(Government) will soon list InvITs on stock market so that retail investors can trade units (of InvITs), offering an opportunity to common citizens to invest in infrastructure projects,” Gadkari said, adding that InvITs assure a 7-8 per cent return.
Expanding NH network
Speaking at an event organised by FICCI, the Minister stressed on the need to expand the national highway network as they carry about 70 per cent of the cargo and 90 per cent of the passenger traffic in the country.
He highlighted that the NHs at 1.47 lakh km are just about 2.3 per cent of the overall road network and said, “before end-2024, we will take the national highway network to two lakh km.”
Gadkari noted that logistics costs as the critical challenge to country trade, exports and business. The current logistic costs in the country range from 14-16 per cent as opposed to 12 per cent in European nations and the US and around 8 -10 per cent in China. He said an integrated approach is needed to achieve a reduction in logistics cost.
‘Waterways is priority’
“My target is to take it up to 10 per cent,” the Minister said and encouraged the industry to plan on adopting water transport. “Our first priority is for waterways, second for railway, third road and fourth aviation,” he added, highlighting waterways as costing one-tenth of the road transport.
The Minister also alluded to alternative fuels such as LNG, bio-ethanol and green hydrogen and said ethanol, methanol, biodiesel, bio-LNG, bio-CNG, electric and green hydrogen, the alternative fuels will substitute imports, (are) cost-effective, pollution-free and can save your (industry’s) logistic cost.
August 23, 2022