Yamuna authority seeks Rs 100 bn for mega projects
ECONOMY & POLICY

Yamuna authority seeks Rs 100 bn for mega projects

The Yamuna Authority has embarked on a venture to generate Rs 100 billion through infrastructure and municipal bonds for its upcoming major projects, including a rapid rail corridor.

Officials have indicated that, as a prerequisite for urban local bodies (ULBs) to access capital market borrowings, the Authority must evaluate its creditworthiness before issuing bonds. During a recent meeting, CRISIL and CARE, two companies, expressed interest in conducting the credit rating for the Authority.

The selected rating agency will scrutinize the Authority's financial management, identifying strengths and weaknesses, and assess its borrowing capacity for term loans. YEIDA CEO Arun Vir Singh highlighted the importance of raising funds through infrastructure and municipal bonds for various significant projects such as industrial and information technology parks, sports facilities, major roads, bridges, rapid rail corridors, and the international airport to achieve comprehensive development in the region. A substantial portion of the funds raised will be allocated to land acquisition and infrastructure development for industrial parks. Meeting the financial demands for the rapid rail connectivity between Noida International Airport in Jewar and Delhi poses a significant challenge for the Authority.

Infrastructure bonds, being debt instruments, entail repaying investors a fixed principal amount with interest over a predetermined period, funding city development or maintenance projects. Notably, when YEIDA secured a loan from SBI, the financial institution assigned an A+ rating to the Authority. Credit ratings typically range from 'AAA' to 'D', with 'AAA' representing the highest ratings and 'D' indicating the lowest or bad credit rating.

The Authority is optimistic about an improved rating, citing an interest-free loan of Rs 17.79 billion from the state government for acquiring over 1,200 hectares of land for five industrial parks. Additionally, funds received under the PM Gati Shakti scheme and consistently increasing profits, surpassing Rs 5 billion in the current financial year, contribute to their positive outlook.

To proceed with the credit rating process, the Yamuna Authority has issued a request for proposal with a submission deadline of December 5. The process will unfold in three stages, involving data gathering and a work schedule plan, a presentation incorporating feedback, and finally, the submission of the final credit rating report, potentially extending beyond seven months.

The Yamuna Authority has embarked on a venture to generate Rs 100 billion through infrastructure and municipal bonds for its upcoming major projects, including a rapid rail corridor. Officials have indicated that, as a prerequisite for urban local bodies (ULBs) to access capital market borrowings, the Authority must evaluate its creditworthiness before issuing bonds. During a recent meeting, CRISIL and CARE, two companies, expressed interest in conducting the credit rating for the Authority. The selected rating agency will scrutinize the Authority's financial management, identifying strengths and weaknesses, and assess its borrowing capacity for term loans. YEIDA CEO Arun Vir Singh highlighted the importance of raising funds through infrastructure and municipal bonds for various significant projects such as industrial and information technology parks, sports facilities, major roads, bridges, rapid rail corridors, and the international airport to achieve comprehensive development in the region. A substantial portion of the funds raised will be allocated to land acquisition and infrastructure development for industrial parks. Meeting the financial demands for the rapid rail connectivity between Noida International Airport in Jewar and Delhi poses a significant challenge for the Authority. Infrastructure bonds, being debt instruments, entail repaying investors a fixed principal amount with interest over a predetermined period, funding city development or maintenance projects. Notably, when YEIDA secured a loan from SBI, the financial institution assigned an A+ rating to the Authority. Credit ratings typically range from 'AAA' to 'D', with 'AAA' representing the highest ratings and 'D' indicating the lowest or bad credit rating. The Authority is optimistic about an improved rating, citing an interest-free loan of Rs 17.79 billion from the state government for acquiring over 1,200 hectares of land for five industrial parks. Additionally, funds received under the PM Gati Shakti scheme and consistently increasing profits, surpassing Rs 5 billion in the current financial year, contribute to their positive outlook. To proceed with the credit rating process, the Yamuna Authority has issued a request for proposal with a submission deadline of December 5. The process will unfold in three stages, involving data gathering and a work schedule plan, a presentation incorporating feedback, and finally, the submission of the final credit rating report, potentially extending beyond seven months.

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