National Highways Authority of India (NHAI) would be borrowing over Rs 2 lakh crore from the market for a five-year period. The funds would be raised to partly finance a slew of infrastructure projects, including the ambitious Bharatmala.

The centre plans to invest a whopping Rs 6,92,324 crore during financial years 2018-2023, of which Rs 3,85,000 crore is for the Bharatmala Pariyojana and about Rs 3 lakh crore for other projects including the conventional highways that it normally finances, NHAI has disclosed in a prospectus just filed.

The Rs 3.85 lakh crore that it would be investing in government's ambitious Bharatmala project would come in a small way from retail Bharatmala Bonds worth Rs 10,000 crore to be raised over several tranches, for which a shelf prospectus has been filed.

"NHAI has availed certain borrowings from Life Insurance Fund and Employees Provident Fund, rupee-denominated masala bonds and is proposing to issue Bharatmala bonds and private placement of long-term bonds, etc. For the total requirement of Rs 6,92,324 crore, NHAI intends to borrow Rs 3,77,045 crore from Government of India, Rs 2,09,279 crore by way of market borrowings and Rs 1,06,000 crore from public-private partnership," the prospectus on Bharatmala Bond issue said.

The government has asked NHAI to develop 34,800 kilometres of highways under Bharatmala Pariyojana.

The Bharatmala bonds, being managed by SBI Capital Markets, are taxable, redeemable, non-convertible debentures of face value Rs 1,000 each.

According to disclosures made by NHAI, rupee depreciation might hurt the organisation as it has unhedged outstanding multilateral external borrowings of Rs 5,634 crore from Asia Development Bank as on September end to be repaid fully by July 2025.

"This loan is not hedged for repayment of principal and interest and repayment of principal and interest is to be made in the foreign currency. Any increase in the interest rates and any adverse fluctuation in the exchange rates may increase the cost of borrowings, thereby increasing the overall costs of the relevant projects," NHAI has disclosed.

It has contingent liabilities in the form of 1,014 arbitration cases and 730 court cases involving Rs 55,345 crore.

On the other hand, NHAI has claimed Rs 29,584 crore in arbitration and 1,418 crore in court cases against contractors and concessionaires.

ROAD RUNNER