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Nath calls Montek over report saying NHAI going bankrupt

Press Trust of India  |  New Delhi 

Irked by reports that the Planning Commission has predicted the National Highways Authority of India will turn bankrupt, an agitated Transport Minister Kamal Nath today picked up his phone and complained to Deputy Chairman Montek Singh Ahluwalia.

"I talked to (Deputy Chairman) Ahluwalia in the morning. He said there is no such report of the Planning Commission," Nath told reporters here.

The latest flash-point in the ongoing public spat comes within a week of Nath hitting out at Ahluwalia, calling the Plan panel an "arm-chair advisor". In return, Ahluwalia had said the government could not be run by only those who build roads.

Nath was responding to queries on a purported Plan panel paper that predicted the NHAI would go bankrupt within three years, as it was borrowing substantially more than its revenue from a fuel cess of Rs 2/litre.

According to the Planning Commission paper, the nodal body on national highways plans to borrow about Rs 50,000 crore against its revenue of Rs 25,000 crore in the next three years.

On his part, Ahluwalia sought to play down the entire incident, saying, "There is no Planning Commission report. I think people keep referring to a discussion paper produced by one officer. Its not approved by me."

Stating that he had seen the report, Ahluwalia said, "Constant references are being made to the Planning Commission or the panel. The Planning Commission has not taken a view on this matter. The issue of financing any major public sector organisation is always being considered...

"How do you finance a programme... We have not taken a final view on that. But we will certainly be looking at that in the formulation of the 12th Plan."

Commenting on the report, Transport Secretary Brahm Dutt said the NHAI was set up through a legislation and its borrowing programmes were approved by a high-powered body of the government, which had representation from different ministries, including Finance.

"NHAI has been set up by an Act of Parliament and sovereign guarantees are involved. Just because the report (borrowing plan of NHAI) does not suit someone, he can't say that NHAI is going bankrupt," Dutt said.

The Authority will need Rs 1.90 lakh crore by 2031, he said, adding that the borrowing programme was approved by the Group of Ministers (GoM).

First Published: Thu, July 15 2010. 16:51 IST