Funding options dry up for highway projects as they get lukewarm response

Under the TOT model, the concessionaire pays a one-time fee upfront, operates toll for 30 years

With 11 of the 21 public sector banks (PSBs) going under prompt corrective action, financing challenges have altered the scenario in the country’s roads sector. 

Funding sources are drying up and this has weakened the risk appetite of banks.

Some highway projects (road monetisation), for which tenders were issued in the recent past, received lukewarm response from developers, mainly on account of a credit crunch in the market.

Funding sources changed rapidly in the last two-three months, an official said, requesting anonymity.

Since April 2017, Allahabad Bank, Bank of India, Central Bank of India, IDBI Bank, UCO Bank, Dena Bank, Oriental Bank of Commerce,