Author: Amitav Ranjan
Publication: The Indian Express
Date: September 2, 2013
URL: http://www.indianexpress.com/news/on-way-to-polls-pmo-pushes-for-delhijaipur-expressway/1163338/

Introduction: NHAI, Road Ministry opposed, PMO seeks awarding of project at the earliest

Despite the National Highways Authority of India (NHAI) calling the project unviable, the Prime Minister's Office is pushing for inclusion of the Delhi-Jaipur stretch in the list of probable expressways.

A letter written by former road transport minister C P Joshi, who is now AICC general secretary, to the PMO underlines the importance of the stretch given that both Delhi and Rajasthan, currently ruled by the Congress, are going to Assembly elections later this year. The letter, sent by Joshi on August 8, was forwarded by the PMO to the Road Transport Ministry on August 19, seeking its comments "urgently".

"Since this will be a major initiative of about Rs 11,000 crore to be launched by our government in the infrastructure sector, having significant impact on the prevailing economic sentiments, I request you to announce this programme at the earliest especially looking (at) forthcoming elections," wrote Joshi.

The PMO, in fact, had been the first to push for the Delhi-Jaipur segment. At a July 19 meeting, Principal Secretary to the Prime Minister Pulok Chatterji insisted that "while pursuing the three expressways, the Ministry of Road Transport & Highways will also work on the financial model for the Delhi-Jaipur Expressway".

This is despite the NHAI's note ahead of the meeting that the project was not feasible either through toll or government funding. "Keeping in view the huge project cost of Rs 15,000 crore, over and above land acquisition cost of Rs 5,000 crore, and the projected traffic, it does not seem to be a viable option to implement it as toll project even with a maximum viability gap funding (VGF) of 40 per cent," the NHAI wrote.

"Implementation of this project under EPC (engineering, procurement and construction) also appears to be a prohibitively expensive proposition and the NHAI would find it difficult to service huge debt required for the project," it said.

But the PMO insisted at the meeting that August 15 would be the deadline for the Road Transport Ministry to complete the pre-feasibility study so that the project could be awarded at the earliest.

The Planning Commission subsequently recommended that land along the sides of the expressway be sold to realtors for developing townships to make the project viable. It contended that Rajasthan and Haryana — another Congress-ruled state — have "both agreed to include development of some townships as part of this project".

"The consultants have brought out that the project is viable without any VGF if these townships are included," it said.

The NHAI, however, trashed this too. While reiterating its earlier position, it told the Road Transport Ministry on July 22 that development of townships alongside the proposed 265-km expressway was "unworkable".

NHAI Chairman R P Singh subsequently wrote that even the per kilometre construction cost was estimated at Rs 50 crore-plus. "In the present juncture it is very unlikely that the private sector will be interested in making such investments," he wrote, adding that implementing the expressway through toll would be "a big challenge".

He added that fall in traffic has also raised questions about the viability of the project "even with high levels of VGF".

The Ministry of Road Transport and Highways has also opposed the proposal. "Since the commitment of land acquisition is in the vicinity of Rs 5,000 crore, the process of land acquisition should not take place before a concrete financial model is in place," it said at a meeting with the Planning Commission on August 16.