11 majors vying for India's largest highway project

Posted By: Religare
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11 majors vying for India's largest highway project
NHAI is planning to launch India's largest highway project till date with an estimated worth of Rs 54 billion and spread over 555 km, from Ahmedabad to Kishengarh via Udaipur.

Reports suggest that as many as 11 major firms are in with a reckoning to bag the project - Indian majors like L&T, GMR and Tata Infra as well as international heavyweights like West Indian First Pacific, Australian Leighton and UM from Malaysia.

The highway stretch passes through Rajasthan and Gujarat and includes sections of NH - 79A, NH - 79, NH - 76 and NH - 8. As part of the project, the important section of the to-be-constructed highway that overlaps with the Golden Quadrilateral (GQ) is being upgraded to a six-lane highway from its existing four-lane form.

The NHAI has set its sights on bringing in no less than Rs 4 billion as premium with a 5 per cent increase every year, even though the Public Private Partnership Appraisal Committee (PPPAC) has set the lower limit to be about Rs 2.98 billion. The government expects the project to generate about Rs 100 billion over the next 20 years.

"It's a big project for us. We will annually get the premium amount with an additional 5 per cent increase every successive year," said an official.

A lot of Indian companies have formed partnerships with foreign majors in order to successfully bid for the project. While GVK has tied up with Australian firm Belford, Nagarjuna Construction and Hindustan Construction have formed an alliance with Malaysian firm PLUS and Vince (Italy) respectively.

NHAI recently awarded L&T a similar project in the same region (Western India) worth Rs 26 billion and is expected to double its earnings from project premiums by the end of this year to Rs 15 billion from about Rs 8 billion where it currently stands.

Story first published: Saturday, June 25, 2011, 9:30 [IST]
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