The government has cancelled the second round of auction for road monetisation after companies offered low bids.
The Union government had offered eight stretches of highways under the toll-operate-transfer (TOT) model in August 2018. Bids were opened in December 2018 where Cube Highways emerged the winner by quoting Rs 4,612 crore, way below the base price of Rs 5,362 crore set by the National Highways Authority of India (NHAI)
The investment appetite between the two TOT auctions suffered, with 12 banks under lending restrictions imposed by the Reserve Bank of India’s (RBI’s) Prompt and Corrective Action. Besides, IL&FS and its group companies defaulted on repayments of their debt, creating a liquidity problem in the system.
