The move follows Tidco's wish to become a facilitator for speeding up infrastructure growth in key sectors like roads, ports and power. To give a boost to the road sector Tidco has founded a holding company called Tamil Nadu Road Development Co. Ltd in which Tidco will have a 20 per cent stake and IL & FS 30 per cent. Other equity partners include Trans Route International of France which will hold 30 per cent stake and CCF, a French FI, 10 per cent. Initial equity capital proposed is Rs 1 crore.

The company has been established, a top Tidco source told TheFinancial Express, to upgrade existing roads. The option to convert the existing 20-km long road from Chennai port to Manali industrial area into a four-lane track is also being examined. The proposal is make this project pay off through collection of a toll chargeable to the users.

However since IL & FS is doing a feasibility study on the possibility of having an elevated highway on this route, Tidco which is working in coordination with the Highways Department has decided to wait until the report is ready before taking a decision on the four-lane project.

The source revealed that when the new projects are taken up the holding company will approach the financial institutions to get the required funds for the projects. The study will also look into the financial viability of the road project before firming up the decision either on the elevated highway or the four-lane project which will be less expensive. But the key issue that will have to be answered by the study is how much of traffic congestionit will ease and whether future growth in traffic can be taken care of. Meanwhile, Tidco is also considering a four-lane 40 km long project to link Tuticorin port and Nanguneri in Tirunelveli district and connecting to the National Highway.

The source said this project is essential because the state government is establishing a hi-tech city in some 500 acres of land where clean-run, non-polluting high-tech industrial units are to be set up. The superintendent engineer of the highways is to provide details of the traffic movement. The proposed four-lane road to connect Tuticorin and Tirunelveli district will besides generating revenue to the promoters of the project also result in reducing five to 10 km of travel and ease congestion in the Tirunelveli city.