BENGALURU: Despite the State government announcing in its July budget this year that the Peripheral Ring Road (PRR) project proposed 17 years ago to decongest the city would be speeded up, the tender process itself is set to be delayed by a few months. The government has decided to hire a consultant with international experience so that it could help mobilise resources globally for the Rs 21,091-crore project.
Two rounds of tendering done in 2022 have not elicited any bidder for the 73-km project being undertaken on a private-public partnership model. The Infrastructure Development Corporation Karnataka Limited (iDECK) is its consulting firm for the project.
A BDA source told TNIE, “The government has decided to go in for a new Transaction Adivsory Service (financial advisor) for PRR. The main hurdle for the project is resource mobilisation. Due to the huge sum involved, there is a thinking that a firm with international exposure will have the potential to help us mobilise the required funding across the world. So, we will first go in for a short-term tender to appoint the Transaction Advisor first.”
The advisory firm will narrow down on the kind of funding that would suit the project, and how to draw big firms to invest in it. He declined to comment on the delay this would entail but it appears that it could be delayed by six more months for the third tender to be floated. The initial plan was to permit the concessionaire to fund the project and lease it out for 50 years so that the amount invested can be got back through toll charges over that period. “Since it involves almost two generations, the response is not forthcoming,” he said.
The thinking is to lease it for 20 to 25 years only. “The government can mobilise ‘betterment tax’ on areas within the vicinity, higher stamp duty charges and subsidise the contractor by adopting Viable Gap Funding methods,” the source added. PRR, comprising eight lanes and four service lanes, will come up on 1,810 acres of land in the three taluks of Bangalore North, Bangalore East and Anekal. It will encircle the city, commencing from Tumakuru Road on NH-48 at NICE Road junction, and end on Hosur Road on NH-44 at Nice Road start point.
Apart from ligitation cases filed against acquisition of land over the years, the big bone of contention at present between landlosers and the BDA is that of compensation. Land losers demand compensation as per the 2013 Act in which case Rs 15,475 crore would go just for compensation. BDA is willing to pay as per the Act that existed prior to 2013, which would reduce compensation by Rs 3,000 crore. The Supreme Court too has given a verdict in its favour.