NHAI's Strategic Financial Move to Reduce Debt

In a significant financial maneuver, the National Highways Authority of India (NHAI) has prepaid loans amounting to Rs 56,000 crore in the fiscal year 2024-25, leading to substantial savings in interest costs. This strategic prepayment is part of NHAI's broader efforts to manage and reduce its debt liabilities effectively.

Breaking Down the Prepayment

Of the total prepayment, Rs 15,700 crore was sourced from the InvIT monetization proceeds, showcasing NHAI's innovative approach to funding. The remaining Rs 40,000 crore was allocated towards prepaying loans from the National Small Saving Fund and the State Bank of India, both of which are known for their high-interest rates. This move not only aids in reducing the interest burden but also demonstrates NHAI's commitment to financial prudence.

Impact on NHAI's Debt Profile

Starting the fiscal year with a debt of Rs 3.35 lakh crore, NHAI has successfully reduced its debt to approximately Rs 2.76 lakh crore by the end of the third quarter of FY25. This reduction is a testament to the authority's effective debt management strategies and its focus on long-term financial sustainability.

Government's Continued Support

Finance Minister Nirmala Sitharaman's decision to retain the allocation to NHAI at Rs 1.68 lakh crore for 2024-25 in her last year's budget underscores the government's support for the authority's infrastructure development goals. This financial backing is crucial for NHAI to continue its mission of enhancing India's highway infrastructure while maintaining fiscal discipline.