It has been quite a turnaround for Maharashtra State Road Development Corporation (MSRDC). From being neglected and debt-ridden, the MSRDC is now the Uddhav Thackeray-led coalition government’s favoured agency for premium projects. The state cabinet committee on infrastructure has given the go-ahead to the agency for new projects worth Rs 1,80,000 crore. Excerpts:
From being a debt-stressed agency not so long ago to the go-to agency of the state government for premium projects, the turnaround has been significant. What led to it?
The government’s support has made all the difference. There was a time, not so long ago, when we were staring at a debt of Rs 6,500 crore. But we are asset-heavy now. The Mumbai-Nagpur Samruddhi Mahamarg has been like an elixir for us. At present, we have projects, sanctioned or under implementation, worth more than Rs 2.5 lakh crore. I feel the revival began in 2016 with a government nod to monetise 23 land parcels, measuring 1,000 hectares in total, along Mumbai-Pune Expressway, which gave lenders the confidence to invest in the Samruddhi project.
But you are also being given areas not part of MSRDC’s core expertise. For instance, you are setting up 19 new townships around the Samruddhi corridor.
Town planning may not be our core expertise, but the ribbon form of development alongside planned corridors has always been our mandate. It has long been a provision in the Highways Act. In fact, the town planner’s post was among the first to be filled up when the MSRDC was formed in 1996. Our plan to build 19 townships around interchanged along the Samruddhi corridor is a value capture proposition. In the past, haphazard development of lack of quality wayside amenities has hurt the state’s interest. Planned ribbon development can boost the state’s revenues and tourism, besides generating local employment. Ten higher education universities are proposed to come up in these townships. We’ve recruited 50 town planners for the task.
Some also say that MSRDC is bagging all these projects owing to your clout among bureaucrats, politicians and consultants…
The MSRDC is a specialised trunk infrastructure company that has a reputation of delivering projects on time and without much cost escalation. This certainly helps.
How do you plan to raise money to complete all these projects?
Money is a state of mind. Let us not get daunted by big projects. When Mumbai-Pune Expressway was first taken up, its cost was Rs 2,100 crore whereas the state public works department’s whole budget was Rs 1,200 crore. We may have new projects worth Rs 1,80,000 crore, but not all of them will be taken up at the state time. Two among these – Pune Outer Ring Road project and the (Virar-Alibaug) Multi Modal Corridor – are ripe for implementation. These will collectively cost Rs 65,000 crore. We already have lenders willing to invest Rs 40,000 crore for these two projects. Projects take time to mature. Each one has its own life cycle. We must keep pushing them ahead. For instance, a sea link between Versova and Nariman Point (now part of the Mumbai coastal road project) was planned way back in 1998. Similarly, the Konkan Expressway, whose DPR we will now be formulating, was first conceptualised in 1981. Another new project, the Nashik connector to Samruddhi (18 km), will be subsumed in the main corridor project cost. We also have approvals for Konkan, Nanded-Jalna expressways, Versova-Virar Sea Link, but these will take two to three years to reach the implementation stage.
What is the current status of implementation of Samruddhi?
We are on course for the timely completion of Samruddhi Mahamarg. Given that it is the biggest greenfield expressway being planned in India (701.15 km, Rs 55,000 crore), we’ll be finishing it in record time. By December end, we completed 70 per cent of the construction work. We plan to ready and commission about 520 km of the corridor in May. The remaining portion will also be commissioned before May 1, 2022. About 22,000 acres from 25,000 owners was acquired for the project between July 2017 and December 2018.
How many of the new projects will be toll-based?
With the exception of the coastal highway project, all will be user-fee based. Toll revenues are a crucial component for any trunk infrastructure project. All governments have understood that the development of a big road infrastructure project in a timely manner, without the imposition of the user fee is a difficult ask. In my experience, users are more than willing to pay the fee, if it is levied rationally.
Does too much reliance on outside agencies and contractors not hurt the state’s own capacity to undertake big projects?
Most of our projects are awarded on Engineering, Procurement and Construction contract basis, with off-budget borrowings and state’s viability gap funds used for financing works. Specialised engineering assignments need expertise that is often lacking in house. It is always better to channelise outside expert help for these. This way, it also works out better for the government. Pushing big infrastructure projects off budget gives them elbow room for effectively servicing existing infrastructure while pushing for time-bound completion of big projects.
MSRDC has also bagged the project to archive the pandemic. Can you shed some light on it?
The project was conceived due to a concern that not much documentation is available on how pandemics were handled in the past. During a government discussion, I’d pointed out how documentation of the drought of 1972 by the then revenue secretary had benefitted in formulation of strategies for better handling of droughts.