NHAI Repays Rs 56,000 Crore Loans Amid Capex Reduction
In a significant development, the National Highways Authority of India (NHAI) has successfully repaid loans amounting to a whopping Rs 56,000 crore during the current fiscal year. This move comes as part of NHAI’s strategic plan to further reduce its debt burden by March. The repayment has been made possible through a combination of prepayments from budgetary allocations and monetization proceeds, marking a crucial step towards financial stability for the organization.
Reducing Debt Burden
NHAI’s debt, which stood at approximately Rs 3.3 lakh crore at the beginning of April, has now been estimated to have decreased to around Rs 2.8 lakh crore. The authority has taken proactive measures to prepay loans from the National Small Saving Fund and some commercial banks, which typically charge high interest rates. This strategic decision is expected to result in substantial interest cost savings of around Rs 1,200 crore.
Financial Strategy
An official from NHAI revealed, “The prepayment of loan has been made to National Small Saving Fund (NSSF) and some commercial banks, which charge high interest rates. Around Rs 15,700 crore has been prepaid from the InvIT monetization proceeds.” The government has set a target of raising approximately Rs 39,000 crore from the monetization of completed projects in the current financial year, with the funds raised intended for further loan repayments.
Future Projections
Despite facing a debt burden that peaked at Rs 3.5 lakh crore in the previous fiscal year, NHAI has taken decisive steps to curtail borrowing and enhance budgetary allocations. The authority’s repayment obligations are projected to reach Rs 62,000 crore in 2027-28, with toll revenue expected to rise to Rs 69,000 crore. NHAI is also banking on a substantial increase in revenue from wayside amenities and complexes along national highways, catering to the needs of commuters with facilities for rest, refreshment, and other services.
NHAI’s forward-looking estimates aim to dispel concerns about its financial capacity and demonstrate a prudent approach towards managing its liabilities. By focusing on debt reduction, strategic prepayments, and revenue generation, NHAI is positioning itself for long-term financial sustainability and operational efficiency.
