For the first time, the UP government is going to undertake development projects through viability gap funding in order to make them profitable for promoters.
Initially, three state highways, connecting Uttarakhand and Chhattisgarh, are going to be upgraded through viability gap funding to the extent of 20 per cent following approval from the Centre.
The projects, which would be executed under public-private partnership model, involve an investment of Rs. 3,000 crore. After a pre-bid meeting with interested developers on February 28, the UP government has decided to call for the final bidding on March 28.
So far, PPP road projects were built on “land for development” pattern where the developer was given additional land for commercial development to make projects profitable. The Yamuna and Ganga Expressways were based on this pattern.
The three projects include four-laning of 206-km-long state highway-57 between Delhi and Saharanpur, which connects with the road leading to Yamunotri in Uttarakhand, at a cost of Rs. 1,735 crore; upgradation of the 56-km-long Bareli- Almora road till Uttarakhand border at a cost of Rs. 354 crore, and upgradation of the state highway 5A from Varanasi to Shaktinagar in Sonebhadra district right up to the Chhattisgarh border at cost of 914 crore.
The government is now pushing these projects after the Upper Ganga Expressway, which was meant to provide a fast, access-controlled road from the National Capital Region to Uttarakhand, has got bogged down in environment-related issues. Also, the developers have shown interest in the two state highways connecting with Uttarakhand with just 10 per cent viability gap funding, although the state has the Central approval for a maximum of 20 per cent.
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Initially, three state highways, connecting Uttarakhand and Chhattisgarh, are going to be upgraded through viability gap funding to the extent of 20 per cent following approval from the Centre.
The projects, which would be executed under public-private partnership model, involve an investment of Rs. 3,000 crore. After a pre-bid meeting with interested developers on February 28, the UP government has decided to call for the final bidding on March 28.
So far, PPP road projects were built on “land for development” pattern where the developer was given additional land for commercial development to make projects profitable. The Yamuna and Ganga Expressways were based on this pattern.
The three projects include four-laning of 206-km-long state highway-57 between Delhi and Saharanpur, which connects with the road leading to Yamunotri in Uttarakhand, at a cost of Rs. 1,735 crore; upgradation of the 56-km-long Bareli- Almora road till Uttarakhand border at a cost of Rs. 354 crore, and upgradation of the state highway 5A from Varanasi to Shaktinagar in Sonebhadra district right up to the Chhattisgarh border at cost of 914 crore.
The government is now pushing these projects after the Upper Ganga Expressway, which was meant to provide a fast, access-controlled road from the National Capital Region to Uttarakhand, has got bogged down in environment-related issues. Also, the developers have shown interest in the two state highways connecting with Uttarakhand with just 10 per cent viability gap funding, although the state has the Central approval for a maximum of 20 per cent.
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