PMO Expressway Project
The steering committee on infrastructure set up by the Prime Minister to fast track infra projects has directed the road ministry to work out an innovative financial model for the Delhi-Jaipur Expressway and also complete the pre-feasibility study by August so that the proposed project entailing an investment of Rs. 14,000cr could be awarded at the earliest. The Planning Commission has already recommended the model adopted to build Ganga and Yamuna Expressway by the UP government for the project in question. In case of Ganga and Yamuna expressways, the land along the expressway was sold to real estate players for developing townships to fund the deficit amount of the construction. NHAI on its part has directed the ministry to negotiate a loan with Japan as the fund can be availed for 40 years at a 0.4% interest rate with a commitment that 30% of the contracts have to be given to Japanese firms or a 30-year loan at a 1.4% interest rate with certain conditions.

According to reports emanating from NHAI, the nodal agency has expressed its unwillingness to build the 265-km long expressway. In a recent letter written to the secretary-roads, NHAI Chairman R P Singh said that the original idea of construction of the expressway with development of townships alongside is unworkable. Keeping the present scenario in view, it is unlikely that expressway will get favorable response from the market largely due to lack of investors' interest as per kilometer construction cost of this expressway projected is estimated to be upwards of Rs 50cr and in view of the prevailing recessionary tendencies, it is very unlikely that the private sector will be interested in making such investments. It also cited a slew of challenges, including its inability to provide funds, lack of investor interest and low traffic projections. It is largely due to the difference of opinions between NHAI, the road ministry and the Planning Commission, the pre-feasibility study is yet to be completed and a final decision on the financial model whether to monetize real estate assets or to take a loan from Japan for the construction of the mega project is still awaited.