Roads ministry to raise Rs 15,000 crore from EPFO

NEW DELHI: The road transport and highways ministry is looking to raise Rs 15,000 crore from Employees’ Provident Fund Organisation ( EPFO) to fund its ambitious highway construction programme.

A senior government official told ET that the ministry plans to issue National Highways Authority of India ( NHAI) bonds to the EPFO in three tranches at an interest rate of 8.3% per annum. The amount raised will be used for highway expansion and bypass construction projects, the official said.

The ministry has set a highway construction target of 15,000 km for this fiscal year, for which it will require at least Rs 1 lakh crore. But it has received only Rs 67,000 crore through budgetary grant for that.

“This emphasizes the current trend among government entities to finance their activity through off budget mechanism,” said Vinayak Chatterjee, chairman at Feedback Infra. “So far as the road sector is concerned, it is indisputably the current growth driver in the economy.” “Road construction has led to a lifting of spirits and order books among suppliers of road construction equipment and allied products,” he added.