• The minister said surety bonds will boost liquidity in the infrastructure sector by freeing up the working capital of contractors stuck in bank guarantees
New Delhi: India's first surety bond insurance product is going to be launched on December 19 to boost liquidity in the infrastructure sector, Road Transport and Highways Minister Nitin Gadkari said.
Speaking at the CII Global Economic Policy Summit, the minister said surety bonds would boost liquidity in the infrastructure sector by freeing up the working capital of contractors stuck in bank guarantees.
He said that highway project developers are facing difficulties in getting bank guarantees for their projects and this is going to be a good relief to the contractors.
Gadkari also said that the ministry will launch India's first insurance scheme to provide guarantees for construction projects.
The announcement comes in the backdrop of India building 26 expressways, multimodal logistics parks, funicular railways, 35 multimodal logistics parks, 670 wayside facilities, 28 emergency landing facilities and 260 ropeways and cable cars in Ladakh.
India has seen a rapid increase in highway development from 91,000 km in 2014 to 1.47 lakh km in 2014.
Gadkari called for developing an indigenous, cost-effective model of manufacturing without compromising on quality. "We have to improve quality and reduce cost," the minister said, adding that ethics, ecology and environment should not be compromised. A project is underway to develop bio-bitumen using rice straw that will replace imported bitumen used for construction of roads. ,
“Strong infrastructure is the backbone of the economy. In this direction, the Government of India has launched PM Gati Shakti to promote integrated infrastructure development," he said, inviting investors to participate in infrastructure creation and assuring them that they would get all regulatory approvals in time. will be given.
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