Need to develop platform for funding maritime projects: Gadkari

Mumbai, Oct 27 (PTI) Union Minister Nitin Gadkari on Monday emphasised the need to create a dedicated platform to finance maritime sector projects, which would, in turn, accelerate economic development and job creation in the country.

Gadkari, a former shipping and ports minister, also expressed confidence that the country's logistics costs will fall to single digits, or about 9 per cent, by the end of December due to improvements in road transport infrastructure.

The road transport and highways minister also said that funds are not a challenge for the National Highways Authority of India (NHAI), but ensuring faster expenditure on road construction is a "problem" for it.

However, for the maritime sector, Gadkari stressed the need for an institutional arrangement for finance, citing the case of the energy sector, where dedicated entities like Power Finance Corporation have helped in adding generation capacity.

"We need to create a special arrangement for supporting them (maritime projects) to create a financial institution, which can be supportive. We have got PFC for power generation," Gadkari said.

"We need to have a plan for a very, very simplified economic mechanism by which we can raise the funds and create confidence in the minds of people." The minister underlined the need for creating a structure to ensure that financing projects become economically viable and added that aspects like transparency, fast-track decision-making, a corruption-free system, and generally upping the credibility of the sector will also help.

Putting in place all the right things can help draw investments into the sector, kickstart a cycle of economic growth and job creation for the country's youth, he said.

"Creating jobs for the Indian youth is the most important economic policy for the government," the senior member of the Union Cabinet said.

He also asked everybody to be mindful of risks while creating financing models, citing his own experience of foreign borrowing.

Gadkari said the shipping ministry had raised Rs 3,000 crore in a foreign currency loan from Singaporean lender DBS to construct a 6-lane highway out of JNPA, using the balance sheet of the country's biggest container port located near the financial capital.

"At that time, I was feeling it was very good (arrangement), but after that, it turned into a problem," he said, explaining how the currency fluctuations caused trouble.

Initially, it was taken as a saving of 6 percentage points by opting for the foreign currency loan, Gadkari said. However, the rupee depreciation has led to a situation where NHAI has had to take over the loan.

Gadkari also recalled that the Sagarmala project was launched during his stint, under which the Rs 6,000 crore profit of the 12 major ports under his ministry has been deployed to raise resources and works of over Rs 7 lakh crore have been completed till now. PTI AA BAL BAL BAL