The Uttar Pradesh government has invited private players for taking up a 75 per cent stake in the newly formed special purpose vehicle - Taj Expressway Authority, which has been constituted for executing the proposed $350 million eight-lane Taj Expressway, linking Delhi and Agra through Greater Noida.
The strategic partner for the project, which is expected to reduce total travel time from Noida Toll Bridge to Agra to around 100 minutes, will have the mandate to carry out a detailed techno-economic feasibility study and then execute the project on a Build-Own-Transfer (BOT) basis for a concession period spanning 40 years.
"The state government will have a 25 per cent stake in the project, which will come in the form of the land cost and pre-operative expenses," industrial development commissioner and principal secretary, U P government, A P Singh said at a seminar on the project. The pre-bid conference is scheduled for June 30.
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The investor will be responsible for operation and maintenance of the 160 km expressway and collection of toll from users during the concession period. As an additional comfort level to investors, the government will be giving away 2,500 hectare of land alongside the facility for real estate development.
"As an expressway of international standard may not be profitable only through revenue generated by traffic, we have added a sweetener of 2,500 hectares of land which will be offered free of cost at select locations in addition to the land required for the expressway," Singh said.
The main attraction of the project lies in the investor's ability to develop township and industrial facilities along with cultural theme parks and other entertainment facilities to appeal to tourists, he said. This will enable the facility to woo traffic from the existing free link on NH-2 and will also roughly cover the investors entire investments in the project, he added.
"There will be no significant reduction of distance between the proposed alternate high-speed link along the eastern side of Yamuna and the existing connection between Delhi and Agra on the NH2," Singh said.
The lowering of time requirement for traversing the distance on the new expressway will be possible through access control by way of tolls, which will eliminate slow moving traffic thereby ensuring faster passage of vehicles, he added.
The project is expected to be completed within three years from the date of achieving financial closure.
The state government will be underwriting the project risk by offering to meet 75 per cent of the pre-operative expenses till the stage of financial closure if the project does not take off.
After the concession period of 40 years, the investor shall transfer its stake to the authority at nil value. However, any lease granted in areas developed for industrial and other uses by the authority will remain valid for a period of 90 years.
The toll for vehicles will not be regulated and shall be decided and changed by the company according to market possibilities, Singh added.