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Maharashtra seeks viability funding for new sea bridge

Monday, 30 June 2014 - 9:44am IST | Place: Mumbai | Agency: dna

After its efforts to invite bidders for trans-harbour link project failed many times, state to approach New Delhi for viability funding

In its bid to take the long-pending Mumbai Trans Harbour Link (MTHL) project closer to fruition, the Maharashtra government is seeking viability gap funding (VGF) from the Centre to make the sea bridge – which will connect Mumbai to the mainland – financially viable.

After failing to get any response to its bids for the project multiple times in the past, the state government is planning to execute the project, which will provide better connectivity to Pune, Konkan and the proposed Navi Mumbai International Airport (NMIA), on cash contract basis.

The six-lane MTHL will have a 16.5-km section in the sea and a 5.5-km portion on land and connect Sewri in Central Mumbai to Chirle in Navi Mumbai. The bridge will be the longest sea bridge in India and the second in Maharashtra after the Bandra Worli Sea Link.

VGF is given to infrastructure projects being executed through public private partnership mode to make them commercially viable. Infrastructure projects have long gestation periods which may affect their financial viability and VGF helps reduce the capital costs.

The MTHL project was earlier being implemented by the Maharashtra State Road Development Corporation (MSRDC) which unsuccessfully tried to bid it out twice. Later, the project was transferred to the Mumbai Metropolitan Region Development Authority (MMRDA), which too failed to bid it out.

"The philosophy of VGF is to make a project viable," noted B.C Khatua, project director of state think-tank Mumbai Transformation Support Unit (MTSU), adding that the loan for such projects was meant to be paid back from the toll collected. Otherwise, the government had to pitch in to make the project viable.

Khatua mooted the need for the VGF to be given to the project, which will now be executed by the government due to lack of bidders response, like similar aid to PPP projects, as the state too had limited resources.

The MMRDA had planned to execute the MTHL under the PPP route on the Design, Build, Finance, Operate and Transfer (DBFOT) basis. In December 2012, the union finance ministry's empowered committee had approved a viability gap funding (VGF) of Rs 1,920 crore for the project.

Apart from the NMIA and Pune, the project will provide better linkages to Goa, the growth centers on the Konkan coastline and southern states. It will also help movement of cargo from the Mumbai,
JNPT and the Rewas ports. The MTHL will cut down 15 km and two hours of commuting time. The MMRDA has claimed that the regional development project will seek to develop Navi Mumbai and the mainland as a counter magnet to decongest Mumbai.

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