The Maharashtra government has approved the INR 17,036.03-crore Bhayandar-Ghodbunder connectivity project on June 22. The approval came almost a year after a tender process was disputed, and it led to legal proceedings. The project will cover a total distance of 15.44 kilometres and will be a new north-south transport link in the Mumbai Metropolitan Region (MMR).
The approval was granted through a government resolution issued by the Urban Development Department. The Mumbai Metropolitan Region Development Authority (MMRDA) has been authorised to implement the project through a public-private partnership (PPP) model with viability gap funding (VGF).
The project includes two major components. A 5.86-kilometre twin-tube underground tunnel will be built between Fountain Hotel Junction and Gaimukh. The tunnel will have three lanes in each direction. The second component is a 9.58-kilometre elevated creek bridge connecting Bhayandar and Fountain Hotel Junction. The bridge will have six lanes.
The approval comes after MMRDA scrapped an earlier tender process for the project. The previous bidding process became the subject of a legal dispute involving Larsen & Toubro (L&T).
According to reports, L&T had submitted a financial bid that was lower than that of the bidder who qualified. MMRDA sought documents from the company to support its financial proposal. It was alleged that the required details were not submitted. Following this, the authority cancelled the tender and decided to begin a fresh bidding process for the tunnel and elevated road project.
L&T challenged the decision before the Bombay High Court. The matter later reached the Supreme Court. Both courts upheld MMRDA’s decision. In May last year, the MMRDA told the Supreme Court that it will retender the project. The authority also said it was exploring ways to reduce the base project cost by around INR 3,000 crore.
Despite this, the project estimate stands at INR 17,036.03 crore. The project will be funded through a combination of government support and private investment. Forty per cent of the total project cost will be provided through viability gap funding. The central government and the Maharashtra government will each contribute 20 per cent of the project cost under this arrangement.
The remaining funds will be arranged by the concessionaire through debt and private investment. Apart from the project cost, an additional INR 713.94 crore has been earmarked for land acquisition, rehabilitation and environmental management activities.
It will now be made with the Engineering, Procurement and Construction (EPC) model instead of the earlier planned Build-Operate-Transfer (BOT) model. The state government has also authorised the MMRDA to seek financial assistance from the centre. It has approved the state’s share of viability gap funding, which is estimated at around INR 3,407 crore.