MSRDC, MMRDA lock horns over trans-harbour link project
MUMBAI: The Sewri-Nhawa Trans-Harbour Link project has run into a fresh trouble with two state-owned entities making competitive claims to build the 22.5-km-long sea bridge. What has added flavour to the contest for bagging one of Mumbais most ambitious infrastructure projects is the political patronage that MSRDC and MMRDA, the two agencies in question, enjoy.
The MSRDC or Maharashtra State Road Development Corporation (MSRDC), which is the nodal agency for this project, is held by the Nationalist Congress Party. Its claim over the MTHL project has been challenged by Mumbai Metropolitan Region Development Authority (MMRDA), which is presided over by chief minister Ashok Chavan, a Congressman.
While the MMRDA has the financial muscle and political support to back its claim, a serious financial crisis has weakened the MSRDCs case for the MTHL project.
Last week, the state cabinet gave permission to the MSRDC to issue 10-year bonds to raise funds from the public. The state has also agreed to stand guarantee for a loan of Rs 425 crore that the MSRDC intends to take with a guarantee fees of 2% per annum.
The guarantee fees will be converted into government equity in the project that will also raise the governments stake in MSRDC. This will help it raise money from the public to fund the projects, a senior MSRDC official told ET. The official, who did not wish to be named, blamed the state and corporation higher-ups for the financial crisis.
The state government owes around Rs 2,400 crore to the MSRDC, which it has not paid up as promised. MSRDC bosses, including past ministers, took some wrong decisions like selling the toll contract for the lucrative Mumbai-Pune Expressway to a private company for an upfront payment. The upfront payment looked substantial when the contract was sold, but appears pittance now as the company is raking in crores from the toll, said the official.
What has added to the MSRDCs financial woes is the dues it owes to contractors for the previous projects like Bandra Worli Sea Link built by Hindustan Construction Company. The MMRDA, in comparison, has no financial worries, and has proposed to build the MTHL for Rs 8,300 crore as against Rs 7,600 crore estimated by the MSRDC.
Not all of this will come from the MMRDA coffers. At least 25% of the project cost will be accounted for by the viability gap funding from the Centre, said an MMRDA official. The MMRDA has proposed that it will recover the full cost of MTHL through a toll to be collected for 45 years, as against the concession period of 50 years quoted by the MSRDC.
Earlier this year, the MSRDC decided to revive the build, operate, and transfer (BOT) model for the MTHL project. The MSRDC has also assumed 20% VGF from the Union government and commercial exploitation of land around the connecting points of the sea link to make the project viable.