Govt mulls options to get Delhi-Jaipur expressway on track

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19 Nov, 2013, 0400 hrs IST, YASHODHARA DASGUPTA, ET Bureau

NEW DELHI: The inter-ministerial committee set up to fast track the much-delayed Delhi-Jaipur expressway has zeroed in on two options to make the project viable.

The highways ministry may either allow the developer to collect the toll from the adjacent Delhi-Gurgaon and Gurgaon-Jaipur highway stretches or, the expressway could also be built via the engineering, procurement and construction (EPC) route, using funding from multilateral agencies, if necessary.

The department of economic affairs will look into whether the government can get the amount of money required to finance the project through EPC route, said a senior highways ministry official. The concession for the Gurgaon-Jaipur stretch will expire in March 2022 while that of the Delhi-Gurgaon stretch will expire in January 2023.

Once these concessions expire, the expressway developer can collect toll from these highway stretches and would have to augment or upgrade the highway as well thus eliminating the aspect of competition between the two projects.

The ministry is also mulling that no revenue would flow to the government during the construction period as per a new model concession agreement that would be created for this project.

Under this option, the ministry expects that it would not be necessary to provide any viability gap funding to the developer by the government. The total project cost in this case for the concessionaire would be around Rs 9,000 crore.

The highways ministry is also planning to market the project overseas through road shows once all clearances are in place to attract foreign investors in light of the near zero interest of Indian private players in public private partnership (PPP) highway projects.

“In addition, we are also looking at the EPC route to build the project. The DEA has to see if they can open a window of borrowing of this magnitude. They have asked for time to do this,” said the official.

Building the project via EPC would require about Rs 7,500 crore (excluding cost of land acquisition, resettlement and rehabilitation and so on). In total, the project would cost about Rs 14,000 crore. “After building the project on EPC, it would be given out for operation and maintenance, and the investment can be recouped through the toll collection. If government does not have the money, we could borrow from multilateral agencies like World Bank or ABD who lend at concessional rates and they can be repaid from the toll revenue,” said another official aware of the development.

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