THE VIP HALL or darbar of the official residence of Union road transport and highways minister Nitin Gadkari in Lutyens’ Delhi welcomes visitors with striking murals and artefacts that are decorated immaculately on the walls and corners. Although abuzz with activity, the hall exudes an aura of serenity. The entry to the bungalow’s hall is flanked by a vibrant painting of Lord Hanuman with an artistic tome of the Bhagavad Gita below it on one side, and Lord Krishna’s statue, in a graceful dance pose, on the other side. Beside Lord Krishna’s statue is one of Lord Kartikeya.

One would, however, be grossly mistaken to deduce that Gadkari draws inspiration only from the Hindu religious or cultural ethos. If he passionately talks about Shivaji Maharaj and his son “Chhaava” (Sambhaji Maharaj) in the midst of the cultural and religious motifs in the hall, he brings in U.S. President John F. Kennedy with equal ease into the conversation.

“U.S. President John F. Kennedy had said that America’s roads are good not because America is rich, but America is rich because of its good roads. I have framed these lines in my office as inspiration,” Gadkari tells Fortune India.

The right inspiration works wonders. And when the right inspiration meets the right individual, it could lead to a magical transformation. And that is exactly what has happened in India’s highways sector. Under Gadkari’s guidance, the sector has witnessed a massive revival in the past decade. Before 2014, the sector faced some tough times — hurdles in land acquisition, funding drying up, and stalled projects being some of the challenges — leading to highway construction of only 5-6 km per day. It has come a long way since; the sector is now synonymous with ultra-mega expressways (for instance, the Delhi-Mumbai expressway), tunnels, and speedy construction, leading to per-day highway construction of about 37 km.

In top gear

Additionally, mega investments have been made in the sector, with it even surpassing China — Asia’s infrastructure behemoth — in terms of overall road network. In January 2024, India’s total road network — spanning 6.7 million km — surpassed China to claim the second spot. It is just a notch below the U.S., which has a network of 6.8 million km.

While one may argue that the total road network includes state highways, district roads, and rural roads, and that crediting these to the road transport and highways ministry may not be correct, the ministry is slowly enhancing the share of national highways (NH) in the overall network. The NH network has gone up from 91,287 km in 2014 to 146,195 km as of December 2024. Also, the quantum of funds that has been pumped into NHs since 2014 is huge. “Beginning 2014 and continuing well into the next two years, we would have invested about ₹50-60 lakh crore in national highway infrastructure projects,” Gadkari says, adding that India has bagged seven world records for speedy construction of highways in the past couple of years.

The National Highways Authority of India (NHAI) also made it to the Guinness World Records for the fastest road construction by building a 2.5 km, four-lane concrete road and a 25-km road within 24 hours during Covid-19 (2020-21). It repeated the feat in 2022, creating a new Guinness World Record by laying 75 km of bituminous concrete in a single lane in 105 hours and 33 minutes on NH53, between Amravati and Akola.

Navigating speed bumps

However, it has not been an easy journey. The highways sector had come to a grinding halt before the National Democratic Alliance (NDA) came to power in 2014, with projects getting stalled because of hitches in land acquisition and funding blues, among others.

Gadkari recalls that when he took over, a large number of projects were stalled. “When Modiji became the prime minister, and I took charge of the ministry, I got a ‘virasat’ (inheritance) of 406 stalled projects, worth ₹3.85 lakh crore; 90% of the quantum had turned into non-performing assets for the banks. All the big companies were on the verge of becoming bankrupt,” he says.

He attributes the road sector fiasco to irregularities in land acquisition and delays in resolving inter-departmental issues. “Roads were earlier awarded without land acquisition or at only 10% or 20% acquisition. Delays in environment clearance, utility shifting, and permission from other departments like railways also impacted the projects deeply,” says Gadkari.

In order to find a solution, the minister resorted to janata darbars — all stakeholders involved in the highways sector were called for joint marathon meetings to revive the projects. “I used to come to office at 10 am. We used to huddle [with] project contractors, consultants, officers, and bankers together to look at the problem and find solutions. I worked very closely with them for three to four months. We used to conduct meetings till late in the night,” Gadkari recalls.

The minister says that after the review, projects worth ₹40,000 crore were terminated, while those worth ₹3.45 lakh crore were revived. “I can proudly say that my department saved Indian banks from NPAs of about ₹3 lakh crore,” he says.

There was no looking back after that. A major call taken immediately was to refrain from awarding highway bids unless a majority of land acquisition was already done. Also, the NDA government started awarding projects only after securing environment and forest clearances. “With these two initiatives, 90% [of the] problems no more exist, and there is speed in implementation,” says Gadkari.

With Central funding, the implementation uncertainties gradually became a thing of the past. The numbers highlight the strides that have been made. Against the Central allocation of ₹11,23,674 crore between FY18 and FY25, the ministry has deployed ₹10,76,209 crore till February this year. Also, road construction has grown three times to attain a record 12,349 km in 2023-24, compared with 4,260 km in 2013-14. Similarly, highway contracts awarded have peaked at 12,376 km in 2022-23 against 3,625 km in 2013-14.

Mega projects like the Bharatmala Pariyojana were envisaged in 2017, with elements like economic corridors, inter-corridor roads, and feeder roads, among others, spanning a total of 26,424 km, of which 19,201 km have been completed till date. The total expenditure incurred by NHAI under Bharatmala till November 30, 2024, was `4.72 lakh crore, according to data from the government.

“Over the past 10 years, India’s highways sector has witnessed a defining transformation — one that mirrors the country’s broader economic and digital evolution. What began as a traditionally manual, construction-led sector has evolved into a technology-driven, sustainability-focussed, and globally attractive ecosystem,” Harikishan K. Reddy, chairman, Cube Highways and Transport Advisors Pvt. Ltd, tells Fortune India.

According to Reddy, programmes like Bharatmala and the National Infrastructure Pipeline have expanded the length of NHs by more than 60%, connecting growth centres with high-speed expressways, economic corridors, and multimodal logistics parks. “These are not just roads — but are growth enablers, reducing logistics costs and catalysing industrial competitiveness,” says Reddy.

Sectoral experts see the developments as transformative. “A significant amount of transformation has happened in the highways sector. From the state of affairs of 2012-13 to where we are now, a long path has been traversed,” says Jagannarayan Padmanabhan, senior director and global head (consulting, transport, mobility and logistics) CRISIL Intelligence. He adds that in the past couple of years, expenditure in the highways sector has been between ₹2.5 lakh crore and ₹2.75 lakh crore. “The ability to even absorb that kind of allocation and expenditure by the highways sector is a significant plus,” he says.

New infra monetisation models

In fact, timely and fast implementation of highways have spun off newer asset monetisation models, wherein companies can take over completed road projects on the toll-operate-transfer (ToT) model and the toll securitisation model. These models have so far been successful only in the highways sector.

For example, Cube Highways, one of the leading entities in road operations and maintenance (O&M) within the highways and infrastructure sector, has tapped the opportunity successfully over the past couple of years and is upbeat about the opportunity the country offers. “Global investors now view [assets of] the Indian highways sector as long-term, stable, and impactful assets — an endorsement of the regulatory maturity, execution capabilities, and returns the sector offers,” says Reddy of Cube Highways.

In ToT, the right to toll collection, operation, and maintenance of a highway section is transferred to a private entity based on competitive bidding, while in securitisation, future toll revenues from infrastructure projects are turned into liquid assets. Those are put on the block for investors to invest, thereby building additional resources for construction. Since 2018-19, as much as ₹42,334 crore has been raised through monetisation via the ToT model for 2,312 km length of highways in 10 bundles till December 2024. Of this, ₹15,968 crore was raised in 2023-24.

“We are talking about ₹2 lakh crore worth of inventory that has gone into the highways sector from the government every year. If you take bank debt and the private sector, an inventory of at least ₹3-4 lakh crore has been created. If you monetise this inventory, you can catapult into another ₹10 lakh crore worth of projects over the next five to six years,” says Virendra D. Mhaiskar, chairman & MD, IRB Infrastructure Developers.

All these innovative models have been made possible because of the timely shunting — by FY16 — of the build-operate-transfer or BoT (Toll) model of public-private partnership (PPP) and taking up implementation of projects with central funding (EPC and hybrid annuity), thereby creating assets that could be monetised in the future.

“Before 2014, we were facing sub-10 km construction per day, execution delays and litigations due to delay in land acquisition, regulatory clearances. PPP interest was low because of uneven balancing of risks. Projects were stalled and banks were not willing to lend. The government quickly realised that PPP was not going to work, so they introduced the EPC or hybrid annuity model,” says Bhavik Damodar, partner, Deloitte India.

Going forward, the infrastructure investment trust (InvIT) model of monetisation offers a chance to the common people of the country to invest in building India and earn about 8% returns. Gadkari confidently mentions that there is no dearth of money to build highways. “I will fund the highways from contributions from the common man of the country,” he says.

Road InvITs, similar to mutual funds, pool money from investors to invest in a portfolio of income-generating highway projects, thereby facilitating exposure without direct ownership. Based on the revenues generated by the projects, the unit holders get a return. The units can be purchased through a demat account. Both public and private InvITs are available in the highways sector.

The government set up the National Highways Infra Trust (NHIT) in 2020 to support its monetisation programme. In March this year, the trust successfully concluded the fourth round of fund-raising at an enterprise value of about ₹18,380 crore, marking the largest monetisation transaction in the history of India’s roads sector. With this round, the total enterprise value across the four rounds by NHIT stands at over ₹46,000 crore.

“In this round, NHIT has successfully raised ₹8,340 crore in unit capital from marquee domestic and international investors along with ₹10,040 crore in debt from domestic lenders,” the government said in a release.

The issue attracted strong demand from both existing and new investors. Domestic pension/provident funds — EPFO, L&T PF, Rajasthan Rajya Vidyut Karamchari PF, Indian Oil Corporation PF — insurance companies including Axis Max Life Insurance; banks/financial institutions including NaBFID, Axis Bank, IndusInd Bank and mutual/investment funds like Nippon India, Baroda BNP Paribas, Nuvama and White Oak Capital participated in the issue.

Canada Pension Plan Investment Board (CPPIB) and Ontario Teachers’ Pension Plan Board participated in the book building to their maximum limit, according to data shared by the government.

The private sector, however, is of the view that certain reforms are needed when it comes to the way the project portfolio for InvITs is worked out. “For InvITs, NHAI gets the projects on a platter, while we have to bid for the same. This needs to be corrected to ensure a level playing field,” says Mhaiskar of IRB Infra, while pointing out that the gains made in the monetisation have to be churned towards more PPP projects as the government cannot continue to build highways on its own as there is a limit to sovereign funding and it has a massive debt component. “More PPP projects need to come up and the government needs to ensure that the projects coming up on PPP basis are economically viable,” says Mhaiskar.

The road ahead

The ministry has charted out an elaborate plan for highway construction in the next two years. Gadkari says the upcoming projects will have scope for PPP, and the government has even fine-tuned the concession agreement for BoT (Toll). In fact, the NHAI announced on April 30 that it was developing the ₹4,613 crore Agra-Gwalior greenfield expressway in BoT (Toll) mode.

“We will be upgrading two-lane highways to four-lane access controlled express highways. I have informed Parliament that highways spanning 25,000 km will be upgraded to four-lane in the next two years at a capital cost of ₹10 lakh crore.” According to sources, the government is also mulling making NHs less than four lanes toll-free. When asked how the highways network would look like in a few years, Gadkari says, “My target is to construct 100 km per day. We have done about 40 km a day.”

He is also working on improving local transport infrastructure. In that context he mentions new initiatives in Nagpur. “We are working on an electric cable mass rapid transport,” says the minister, adding that the pilot has been launched in Nagpur. “It will be a flash charging bus with executive chairs, AC, bus hostess, food and on-board entertainment,” he says, adding that its ticket prices will be 30% lower than diesel buses. “At the stop, the bus will quick charge itself through a pantograph while passengers board and deboard,” Gadkari says, adding that it has technology from Siemens and Hitachi, and several companies like Tata Motors have evinced interest in it.

This fits in with the overall theme of energy transition of the government and also the use of electric vehicles and alternative fuels like ethanol, biofuels, and hydrogen, which are very close to Gadkari’s heart (see interview for details). He firmly believes that a reduction in the fuel import bill, worth ₹22 lakh crore, will only help the Indian economy, especially the rural economy. In fact, Gadkari is overseeing a major initiative of National Highways for Electric Vehicles (NHEV), which aims to upgrade the current highways into e-highways. It envisages a network of charging/battery swapping ecosystems to facilitate long-route travel in electric vehicles (EV) across the country.

NHEV, in April, acquired a 4.7-acre NHAI site in Tirunelveli, Tamil Nadu, pledged for the development of its 3G EV charging station. “Strategically located on the Kanyakumari–Madurai highway corridor, this marks the second charging station on this route and the first under the NHEV South Zone roll-out,” NHEV said in a release.

One of the key measures Gadkari had announced is a satellite-based tolling system. It had been undergoing pilot tests for the past couple of years. He points out two key issues. Lack of adequate equipment and satellites. “We have done a lot of work on several pilot projects. I do not want Chinese manufacturers to get into this. We are trying to find a reliable service provider, even if it comes at a slightly higher cost, as we cannot afford glitches in the system,” says Gadkari.

For someone who is transforming India’s highways infrastructure to global standards brick by brick, it is expected that these would figure high up on his list of achievements. Gadkari, however, doesn’t believe the Delhi-Mumbai expressway or the tunnels worth ₹3 lakh crore being built in Kashmir are the high points of his storied career. Instead, he recounts an incident from childhood. “I used to go to my mama’s [uncle] place with my mother and sisters in a cycle-rickshaw. On the way, there was a locality called Tilak Putla in Nagpur, where there is an uphill slope,” says Gadkari, adding that the rickshaw-puller would pull with all his might and the young boy would jump down to push the rickshaw up the slope. Even then, he felt the rickshaw-puller’s plight was “inhuman”. Now, with an e-rickshaw, people don’t have to make such efforts. “The justice they [the rickshaw-pullers] got is my greatest achievement as transport minister,” says Gadkari with a sense of contentment.

With his heart in the right place and the transformation of the country’s highways infra well on track, Gadkari can look forward to making John F. Kennedy’s words a reality for India.