Malaysians offer to build Indian Highways

Malaysian consortium is offering to build (and then operate and transfer – or BOT) the highways in India… some especially important and significantly useful highways. This is what is lacking in India currently. Malaysia, on the other hand, has nice looking highways in their country with wonderful work having been done in terms of their infrastructure… specially their metro and the airport at KL!!

The project, to be executed on a build-operate-transfer basis in a phased manner, envisages two expressways: one linking Thiruvananthapuram, Chennai, Bangalore, Hyderabad and Pune; the other connecting Delhi and Kolkata.

Malaysian cabinet minister of works Dato Seri S Samy Vellu told FE that 11 Malaysian companies, including IJM, United Engineers Malaysia Group and Ranhill Corporation, were keen on the project. “The expressway will pave the way for investors pumping in money to set up units along (the expressways). However, land acquisition will have to be done by the Indian government,” he said.

If the proposal passes muster with the Indian government, it could well turn out to be the biggest foreign direct investment in a road project in the country. Infrastructure funding experts estimate the project to cost at least Rs 42,000-56,000 crore, given the ballpark cost of Rs 6-8 crore a km, depending on terrain.

Vellu said the consortium, backed by the Malaysian government, would also ask India to extend a budgetary grant to the project. In India, BOT leases typically have a 20-year concession period. At present, Mumbai-Pune is the only expressway and two others, Delhi-Jaipur and Vadodara- Mumbai, are being planned.

“Toll revenues are expected to be significant,” Vellu, who is president of the Malaysian Indian Congress and one of the longest serving ministers in the cabinet, told FE along the sidelines of the Pravasi Bhartiya Divas 2007, organised by the ministry of overseas Indian affairs and supported by the Delhi government and the Confederation of Indian Industry.


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Desh Kapoor

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