In a bid to grant impetus to the much-delayed MTHL, the Mumbai Metropolitan Region Development Authority (MMRDA) has stepped in to make the project more viable by planning a soft loan of nearly 20 per cent of the total cost to the successful bidder.
In a bid to grant impetus to the much-delayed Mumbai Trans-Harbour Link (MTHL), the Mumbai Metropolitan Region Development Authority (MMRDA) has stepped in to make the project more viable by planning a soft loan of nearly 20 per cent of the total cost to the successful bidder.
The MMRDA has floated bids for the Rs8,800 crore and 22.5-kilometre-long MTHL, which will connect Sewri in central Mumbai to Chirle village in Uran, Raigad, besides providing better linkage to the proposed Navi Mumbai international airport, Pune, Bangalore, Goa and the growth centres in Raigad and Konkan.
Confirming that the soft-loan sweetener would supplement the 40 per cent viability gap funding (VGF) already in place, a senior MMRDA official said the “back-ended cash flows” would initially imply lower toll from the project which would pick up with development. “It is to take care of these back-ended cash flows that the MMRDA is planning the soft-loan option.” This low-interest loan would be around Rs1,760 crore.
While stating that a maximum VGF of Rs3,520 crore could be granted for the project by the state and the Centre, the official added that the bidder quoting the lowest VGF would be given charge of the project, while MMRDA will pitch in with the VGF.
The bidding for the project has fallen through twice in the past. After the bids submitted by the two Ambani brothers were found to be “unrealistic,” the state in 2008 decided that the work would be undertaken by it without opting for the public private partnership (PPP) route.
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