That would mean that these two entities would not borrow from the market for funds — NHAI for the third year in a row and the Railways for the second year in a row. The Centre’s borrowing plan for FY24 includes the entire market funding requirement of the Railways and NHAI. 

  To maintain transparency and sustainability, the Centre will likely continue to shoulder the massive capital expenditure requirements of the two largest state-run transport infrastructure builders — the National Highways Authority of India (NHAI) and the Indian Railways — fully for the next financial year as well, sources said.  

 That would mean that these two entities would not borrow from the market for funds — NHAI for the third year in a row and the Railways for the second year in a row. The Centre’s borrowing plan for FY24 includes the entire market funding requirement of the Railways and NHAI.  

 A senior official said that the capex of the two entities would likely be through the Budget next year. Besides bringing transparency as both execute the Centre’s plans, the government’s direct borrowing would also ensure that the cost of funds for both entities would be about 50 basis points lower than what it would have been if they were to borrow from the market. 

  For the third year, the government extended a massive budgetary capex support to Railways with `2.4 trillion for FY24, up 50% on the year and accounted for one-fourth of the Centre’s `10 trillion capex outlay. 

  The Railways’ annual borrowings used to be `60,000-70,000 crore from the market in recent years except in FY24.  

 High debt forced the Centre to halt fresh borrowing by the highway maker NHAI in FY23 and FY24. As a result,  the country’s financial  support  reached  a whopping  $1.74  trillion in FY23,  more than three  times higher than  the $57.35 trillion  in FY22. 

  With  the massive  expansion  of highways  after the Narendra Modi government came to power in 2014,  NHAI’s  debt  increased  from  $23.797 billion  in March 2014 to  $3.48  trillion in March 2022. 

  This  led to  an increase  in debt  service burden,  which  reached  `31,735 crore in FY23. 

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