NEW DELHI: Lenders are not just worried about their exposure to IL&FS Transportation Network (ITNL), but also over two projects of national importance — the Zojila Tunnel and Srinagar Sonmarg Tunnelway (SSTL) — that will connect Kashmir with
Ladakh.
Work on the
Z-Morh tunnel that is part of SSTL has come to a halt since July 20 due to a funds crunch. There is little progress on the prestigious Zojila tunnel. Here, a major concern is about ITNL’s promise to complete the project with Rs 4,500 crore, which is lower than the project cost of around Rs 5,400 crore.
Sources said the
infrastructure major is yet to submit a Rs 500-crore bank guarantee to the National Highway and Infrastructure Corporation to get the advance to carry out construction. This project (Zojila tunnel) is being undertaken with 100% government funding.
SSTL is a joint venture with Soma Infrastructure, which is facing financial problems and its projects across the country are facing hurdles. ITNL holds a 49% stake in the JV, with nearly 40% of the Rs 3,500-crore Z-Morh project completed. Lenders have advised ITNL to exit the project and get its funds back from its partner, bankers told TOI.
ITNL is seen as a major source of raising funds for the IL&FS Group, but lenders say that several of the company’s projects are facing hurdles. It is facing problems in the Gurgaon rapid rail project and is looking to exit it. In some of the projects such as Amravati-Chikali national highway, financial closure is yet to be done, while the Chikali-Tharod stretch never took off.
Another important project, the Kiratpur-New Chowk highway, is mired in dispute with the National Highways Authority of India (NHAI). “Both have given termination notices to each other but ITNL did it first as land was not available,” said a source.
It has some other projects such as Barva Adda in Jharkhand as well as Hazaribach-Ranchi Expressway, which are seen to be on track. NHAI officials said there are about four highway projects being executed by IL&FS, which are stuck due to a funds crunch. “But there is no question of buying any entity as we don’t have the mandate. However, we explore how to complete these unfinished projects either by taking them over or through funds infusion,” a source said.
