Finance Ministry refuses funds to Mumbai harbour link
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The much-delayed Mumbai Trans-Harbour Link (MTHL) has suffered a fresh setback as the union finance ministry has refused to approve its viability gap funding, asking the city's development authority to treat the sea-link as a road and reduce the concession period to 30 years from 45.
The 22-km, Rs 9,630-crore MTHL is a critical infrastructure showpiece for the financial capital as it will drastically reduce the distance between central Mumbai and Navi Mumbai, and also connect to the proposed second airport there.
The longest sea-link in the country has been in the planning stage for more than three decades, and has gone through two failed rounds of bidding. The jolt from the finance ministry comes after the Mumbai Metropolitan Region Development Authority (MMRDA) short-listed five bidders more than four months ago.
Approvals from the central government for the request for proposal documents and the viability gap funding of 20 per cent of the total project cost are crucial for the shortlisted consortia to prepare and submit final bids.
However, the finance ministry is insisting that MMRDA treat the link as a road project. This means the standard Model Concession Agreement (MCA) for roads will apply. "It may be a bridge but it is a road project going by the standards of the Indian Roads Congress. So we have suggested bidding it out through the roads MCA," a senior finance ministry official said.
Further, if MMRDA expects viability gap funding for the project, then the finance ministry wants it to reduce the concession period now proposed at 45 years. "Our calculations reveal the project will break even in 30 years. Why should the developer charge toll for an additional 15 years?" the finance ministry official asked, pointing to the Delhi-Gurgaon Expressway where the high court has had to intervene. The finance ministry has also raised concerns over the proposal to charge a congestion fee.