IL&FS to return incomplete road projects to NHAI for rebidding

MUMBAI : Debt-laden Infrastructure Leasing & Financial Services (IL&FS) Ltd has agreed to return under-construction road projects to the National Highways Authority of India (NHAI) for fresh bidding, according to the minutes of IL&FS’ April 22 board meeting.

In a meeting with NHAI officials, IL&FS did not object to inviting fresh bids for the underconstruction projects provided that they arrive on “an amicable settlement of dues”. A copy of these board minutes was reviewed by Mint.

Settling and awarding dues to IL&FS is imperative as the financial services and manufacturing group of companies is struggling under a massive debt of ₹99,358 crore as of September 2018.

IL&FS defaulting on debt payments precipitated a liquidity crisis in non-banking financial companies (NBFCs).

According to the minutes of the board meeting, IL&FS and NHAI discussed the future of 10 projects that are incomplete, at various stages of completion or where the financial closure has not been achieved yet. Out of them, three of the projects have achieved 80% completion and the remaining seven are completed in the range of 10-50%. These projects, after analysing the information available in annual reports, are worth ₹14,519 crore. This is expected to bring in much-needed clarity as many of the ongoing NHAI projects with IL&FS were likely to miss deadlines due to lingering ambiguity on the future of these projects. These projects include the strategically important Z-Morh Tunnel, also known as Srinagar Sonmarg Tunnelway, in Jammu and Kashmir.