In an attempt to attract more bidders for the ambitious Rs10,000-crore Mumbai Trans-Harbour Link (MTHL) project connecting Sewri in the northeastern part of the island city with Nhava Sheva (JNPT Port area), the state government has proposed to cover the revenue risk of the build-operate-transfer (BOT) operator.
"We cannot take construction risk but we can definitely cover the revenue risk of the BOT operator. We plan to offer long, soft loan to the BOT operator and also compensate the second and third lowest bidders (L2 and L3 bidders) for the cost of bidding," MMRDA (Mumbai Metropolitan Regional Development Authority) Commissioner Rahul Asthana has said.
The government started the bidding process in 2004, but it has been unable to make any progress so far.
"This move will encourage more developers, including from overseas, to bid for the ambitious project. We believe that by the third quarter of 2012 we will be able to award the contract," Asthana said.
MMRDA, the nodal government agency for infrastructure development in the city, is also ready to compensate the BOT operator in the case of low toll collection against the projections, he said. "However, in the case of higher toll collection, the BOT operator needs to share benefits with MMRDA," he said.
MSRDC -- state road development body -- which was earlier handling the project, made several attempts to invite bids in 2004 on BOT basis, and in 2008 on a design-build-contract basis.
In June 2008, separate bids by the Ambani brothers had been found unrealistic. Reliance Industries had bid for a 75 year concession period, while the ADA Group quoted only a 10-year concession period. A cabinet sub-committee on infrastructure had then recommended scrapping of the public-private-partnership model and executing the project on a cash contract basis. As many as 13 companies showed interest, but did not submit bids.
In 2009, government decided to implement the project on a PPP model under viability gap funding scheme of Centre for which an in-principle approval from the Cente was received in April 2009. State administration recently handed over the mandate of the project to MMRDA.
The MTHL, which will connect Sewri to Nhava Sheva in Raigad district across the creek, is aimed at developing the mainland and reducing the pressure on Mumbai.
The project consists of construction of a six-lane road-cum metro bridge. It will be then extended to the upcoming Navi Mumbai airport, near the JNPT port near Panvel.
