Mumbai Metropolitan Region will need Rs 3L cr by 2021 for infra projects

Written by Shubhra Tandon | Mumbai | Updated: Aug 16 2013, 08:20am hrs
The Mumbai Metropolitan Region (MMR) will need R3 lakh crore in investment by 2021 for development of infrastructure, including ports, airports, water resources, roads, power and local municipal infrastructure, among others.

However, mobilisation of resources remains a key challenge as improving municipal finances is a tough task and the state's experience with PPP projects has not been encouraging.

According to UPS Madan, the metropolitan commissioner of Mumbai Metropolitan Region Development Authority (MMRDA), the onus of raising funds will fall on the state-run authority responsible for infra development of the MMR. Getting 80% of investment at a regional level is a direct burden on MMRDA, he said at the Maha Infra Summit, in Mumbai.

According to Madan, of the R3 lakh crore, the share of PPPs is likely to be 28% while the government and state-run authorities would have to contribute about 22% and 29%, respectively. The remaining 21% would likely come from loans.

The Maharashtra government is now also looking at forming a dispute resolution authority to address issues surrounding major infrastructure projects, many of which have been delayed.

There have been instances where disputes have arisen after the tender procedure has been completed. As a result, tenders had to be re-issued. Such a process is very tricky and takes a lot of time. There is, therefore a need to develop a dispute resolution mechanism that will tackle such issues," Prithviraj Chavan, the chief minister of Maharashtra, said recently. He also said the chief secretary has already been told to set up a separate authority to mitigate issues on projects.

While the chief minister did not specify any particular project, but the R9,630 crore Mumbai Trans Harbour Link (MTHL) is the latest casualty in the long list of key infrastructure projects of the state that have faced inordinate delays and cancellations. The Worli-Haji Ali Sea Link, Metro line II and Navi Mumbai Airport are some of the other projects stuck due to various issues.

The Line 2 of Mumbai Metro, a fully elevated 32 kilometre long stretch, is not moving for want of environment clearance for a car depot. Meanwhile, the R5,100-crore Worli-Haji Ali Sea Link project awarded to Reliance Infrastructure in 2010 never took off due to issues on viability gap funding and the land for the casting yard and was finally scrapped.

The 22-kilometre MTHL, which will connect Sewri in the island city to Nhava in Navi Mumbai, did not receive a single bid on August 5, the last date of bids submission. Now, the state is planning to go ahead with the project on its own and is weighing several funding options, including seeking national project status for it. Chavan said disputes arise mainly in the transport and power sectors, adding, this calls for a clear cut mechanism to resolve such problems.