Chennai, Aug 20: The Malaysian government has offered to do a feasibility study on the construction of India's national highways free of charge. But the offer has many invisible strings attached to it.

Malaysian minister for works DS Samy Vellu made this conditional offer tounion minister for surface transport T G Venkataraman who is curently on a tour to Southeast Asian capitals. The Malaysian minister said the feasibility offer would incur an expenditure of Rs 4 or 5 crore, was a goodwill gesture to India as an incentive.

The incentive which the Malaysian minister is apparently seeking to give is the first right of refusal if it is found to be matching the L1 bidder in the global tender that would be floated for the highways project once the feasibility study is completed.

Venkatraman is currently visiting Malaysia, Seoul and Singapore on the specific mission of seeking foreign direct investment (FDI) for India's roads, highways and port development projects.

It may be recalled that India and Malaysia had signed an agreement in 1995 for mutual cooperation in infrastructural areas especially in the development of roads, highways and major ports. Now that India has signalled its intentions to put infrastructure development on a priority basis, the Malaysian government is keen reactivate the agreement.

As a prelude to this it has offered to do the feasibility study of the highways development projects.

The Indian minister is expected back in India on August 23 and would brief the cabinet on the fruits of his mission to seek FDI in these core sectors - especially highways, roads and ports.

It is reliably learnt that the Malaysian government has extended the offer to do free feasibility study on the proposed 28 kms long elevated expressway from Chennai port to Tambaram without diverting the existing traffic. This offer too comes with the same strings attached to it.

The Union government is planning to convert the existing two-lane national quadrilateral highways into four-lane traffic highways. It also seeks to convert some high density corridors into four lanes. For example the high density corridors that are slated for such conversion would include Mumbai-Bandra, Delhi-Jaipur and Chennai-Bangalore corridors. Of the total of 35,000 km of national highways, only 5 per cent have got four lanes, while 80 per cent come under the two lane category, with 15 per cent having only a single lane.

For starters, the Centre has decided to take up conversion of only 8,000 km of two-lane traffic highways to the four-lane system. Additionally another 2,000 kms of high density corridors too are to be converted into four-lane highways.

The Centre has estimated that conversion of 10,000 km of roads into four-lane highways will cost in excess of Rs 50,000 crore. Besides land acquisition costs, the Centre also has to reckon with other costs such as bridge construction, removal and relocation of utilities, relocation and rehabilitation of displaced families.

The World Bank and Asian Development Bank is willing to fund `bankable' BOT highway projects. Both of them are willing to participate up to 25 per cent of equity of the BOT projects. The Centre has decided to fund the projects through the BOT route. The Centre is also adopting the Karnataka model for development of a new highway initiated by Deve Gowda government in the state in August 1995. Deve Gowda proposed that a new two-lane express highway be built from Bangalore to Mysore on a BOT basis.

A source close to Malaysian government told The Financial Express that the 800 km North-South highway of Malaysia which took six years to build and became operational in 1994 had estimated a vehicle diversion factor of 0.5, ie, for every 1000 vehicles using existing highways, 500 would move via the new highway. But the Malaysian government soon found out that 800 vehicles were using the highway.

The government has invited proposals for feasibility study of Chennai-Trichy highway which will go up to Bukkathurai ie beyond Chengalpattu and before Maduranthakam as part of the National Highway-45 project.

Tamil Nadu too would pursue the BOT route for its high density corridors.

Copyright © 1997 Indian Express Newspapers (Bombay) Ltd.