Debt-weighed, Infrastructure Leasing & Financial Services Ltd, has confirmed to return under-construction road projects to the National Highways Authority of India for fresh bidding. On April 22, during a board meeting with NHAI officials, IL&FS did not refuse to invite fresh bids for the under-construction projects provided that they arrive on an friendly settlement of dues.
Settling and awarding dues to IL&FS is indispensable as the financial services and manufacturing group of companies is struggling under a massive debt of INR 99,358 crore as of September 2018. IL&FS defaulting on debt payments precipitated a liquidity crisis in non-banking financial companies.
The future of 10 projects that are incomplete was discussed by IL&FS and NHAI, 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 examining the information available in annual reports, are worth INR 14,519 crore. This is assumed 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.
This is in addition to 14.2-km Zojila tunnel project, deemed as the country’s longest road tunnel in Kashmir which has already been returned to NHAI for rebidding.
The work done by IL&FS would be valued by the regional offices of NHAI to arrive at an arbitration amount.
A spokesperson for IL&FS in an emailed response said that “All our road projects are on track, as planned, to be resolved as per the resolution framework submitted to the government. With regards to the incomplete projects, we are in discussion with the concerned authorities to resolve them in accordance with the new framework announced by the government in March this year.