The Maharashtra government has been actively pushing forward timely implementation of road projects in the state. It has also been trying to ensure adequate funds availability, for both ongoing and upcoming road projects. In December 2019, the state government decided to infuse additional share capital in its flagship Mumbai-Nagpur Super Communication Expressway project. More recently, under the civic budget 2021-22, the Municipal Corporation of Greater Mumbai (MCGM) allocated funds for various road projects in the city. The corporation has allocated funds worth Rs 13 billion and Rs 20 billion for the implementation of the Goregaon-Mulund Link Road Tunnel project and the Mumbai Coastal Road project respectively. The government has also made the state-run Maharashtra State Road Development Corporation (MSRDC) the go-to agency for infrastructure projects in the state. With this, MSRDC, which was not so long ago saddled with a debt of Rs 65 billion, has scripted a turnaround, and now holds government projects worth Rs 2.62 trillion.
Approval granted for major road projects
Recently, the state government’s Cabinet Committee on Infrastructure (CCI) gave MSRDC the go-ahead to undertake seven new big-ticket infrastructure projects worth Rs 1.86 trillion. The new projects assigned by the CCI to MSRDC include the much-delayed 126 km Virar-Alibaug multimodal corridor. Previously, the Rs 398.41 billion project was being implemented by the Mumbai Metropolitan Region Development Authority. Besides, the committee, in its meeting on January 14, 2021, sanctioned a viability gap fund (VGF) of Rs 45 billion and a state equity component, while according approval to MSRDC’s financing proposal for the 172 km Pune Outer Ring Road project. The two projects will now be MSRDC’s high priority assignments to be commissioned by 2024.
Besides, the CCI has also approved a new 18 km long Nashik connector for the Mumbai-Nagpur expressway, which is estimated to cost Rs 2.5 billion. Further, MSRDC has been given the go-ahead for preparing detailed project reports (DPRs) for the Rs 710 billion Konkan expressway, the Rs 70 billion Nanded-Jalna expressway and the Rs 320 billion Versova-Virar arm of the Mumbai Sea Link. Meanwhile, MSRDC is already overseeing the construction of the Rs 66 billion Mumbai-Pune expressway missing link, the Rs 70 billion Versova-Bandra Sea link and the Rs 8 billion Thane Creek Bridge III project.
Strong funding support
Most of the projects under MSRDC are awarded on engineering, procurement and construction contract basis, with off-budget borrowings and the state’s VGFs used for financing works. Although the agency has received approval for new projects worth Rs 1.86 trillion, it is confident of mobilising sufficient funds for ensuring timely implementation of all projects. With the exception of the coastal highway project, all other approved projects will be user-fee based. Besides, the authority has decided not to take up all new projects at the same time. Among the recently approved projects, the Pune Outer Ring Road project and the Virar-Alibaug multimodal corridor are currently set for implementation. These will collectively cost about Rs 650 billion. MSRDC is already in discussion with lenders that are willing to invest Rs 400 billion for these two projects. Meanwhile, the Konkan expressway, Nanded-Jalna expressway and the Versova-Virar Sea Link project will take about two to three years to reach the implementation stage.
The Maharashtra government has also decided to provide an additional share capital of Rs 35 billion for the Mumbai-Nagpur expressway project and waive the stamp duty on MoUs between agencies working on this expressway project. The Rs 35 billion share capital will be infused, in addition to the existing capital of Rs 273.35 billion, which is in the form of Rs 35 billion from MSRDC, Rs 55 billion from state public sector undertakings, waiver of royalty on minor minerals at Rs 24.14 billion, interest on loans during the construction period at Rs 63.96 billion and the cost of land at Rs 95.25 billion. Besides, a loan of Rs 245 billion has been approved for the project’s special purpose vehicle, the Nagpur-Mumbai Super Communication expressway.
Key projects under MSRDC
Mumbai-Nagpur Super Communication expressway
The 701-km Mumbai-Nagpur Super Communication expressway – officially renamed as Hindu Hridaysamrat Balasaheb Thackeray Maharashtra Samruddhi Mahamarg – is the longest greenfield expressway being planned in India. The project is expected to entail an investment of over Rs 553 billion. It is being implemented by MSRDC in 16 packages. The project, which was initially slated for completion by December 2021, will now be completed by May 2022. The delay, however, is not expected to lead to any cost escalation. As of December 2020, about 70 per cent of the construction work has been completed on the project. The 520 km stretch between Nagpur and Shirdi is expected to be thrown open for vehicular movement by May 2021, while another 103 km stretch till Bhiwandi is expected to be completed by December 2021. About 22,000 acres of land had been acquired for the project between July 2017 and December 2018.
The Konkan (Chirle-Patradevi) expressway is the greenfield project that will be constructed along the Maharashtra coastline, connecting the districts of Raigad, Ratnagiri and Sindhudurg. The state is looking at starting the 500 km expressway from Chirle in Raigad where the under-construction 22 km sea bridge, the Mumbai Trans Harbour Link, ends. The expressway will extend up to Patradevi at the Maharashtra-Goa border in Sindhudurg district. MSRDC is yet to finalise the DPR for the Rs 710 billion project. MSRDC has divided the entire stretch of the proposed expressway into four different sections, in order to expedite work on the project. Each of the stretches will be 100-125 km long.
Conceptualised in 2011, the project has been mired in delays due to land acquisition and lack of statutory clearances. MSRDC has planned to invite bids for the project by June 2021, once a substantial amount of land has been acquired. The 126 km corridor will be constructed in two phases, with Phase I entailing the construction of a 98.5 km highway between Navghar and Balavali, and Phase II entailing the construction of the 29.9 km Balavali and Alibaug highway. Construction work on the project is expected to begin by September 2021.
Pune Outer Ring Road
The Rs 140 billion ring road, meant to decongest Pune’s traffic, has been designed to provide an alternative link for diverting highway vehicles entering Pune from Mumbai, Nashik, Aurangabad, Hyderabad and Bengaluru. As of December 2020, the land acquisition process has commenced for the 172 km project. The project has been approved by the state government and has been accorded the status of a state highway. About 2,300 hectares of land needs to be acquired for this project.
Versova-Bandra Sea Link
MSRDC is also undertaking the construction of the 17.17 km Versova-Bandra Sea Link at a cost of over Rs 113 billion. In June 2019, the project was awarded to the joint venture of Astaldi Group and Reliance Infrastructure Limited. Besides, MSRDC has also received CCI approval for the 43 km extension of the sea link up to Virar, at an additional cost of Rs 320 billion. The agency will now prepare a DPR for the Versova-Virar extension. According to the pre-feasibility report, the sea link will be built with connectors at Charkop, Uttan, Vasai and Virar. The 4+4-lane main bridge will connect Versova to Virar with 3+3-lane connectors at these four locations.
Kharghar-Turbhe elevated road and tunnel
In March 2020, MSRDC granted approval for the implementation of the 5.4-km project. The agency is negotiating with the City and Industrial Development Corporation (CIDCO) and the Maharashtra Industrial Development Corporation (MIDC) over fund contribution for the 12.22 billion project. It is reported that CIDCO will fund Rs 3 billion, while Rs 1.5 billion will be contributed by MIDC. While MSRDC will contribute Rs 3 billion, funds worth Rs 6.22 billion will be borrowed from financial institutions. Currently, the state finance department is working out a plan to execute the project soon.
Capital expenditure by the Maharashtra government is expected to witness robust growth over the next few years, supported by a large number of upcoming road projects in the state. Timely and hindrance-free completion of these projects is imperative for the development of an ambitious road network in the state, in order to help bring about significant reduction in travel time between cities. However, there is a need to tackle issues related to land acquisition and environmental clearances in a time-bound manner for the successful implementation of these projects.