03-05-2025
MSRDC to scrap Rs 26,300-crore contracts for Virar-Alibaug Corridor, fresh tenders likely under BOT model
The Maharashtra State Road Development Corporation (MSRDC) is set to scrap 11 construction contracts worth Rs 26,300 crore that were awarded by the Eknath Shinde government to seven civil engineering firms for constructing the first phase, totaling 96.47 km, of the ambitious 126-km Virar–Alibaug Multi-Modal Corridor (VAMMC) project. While the earlier tenders were awarded under the Engineering, Procurement and Construction (EPC) model, the government is now contemplating floating fresh tenders to build the entire project under the Build-Operate-Transfer (BOT) model.
The Virar–Alibaug Multi-Modal Corridor is a long-planned infrastructure project under consideration since 2011. It is a 8–14 lane access-controlled expressway that was originally supposed to be built by the Mumbai Metropolitan Region Development Authority (MMRDA), but was handed over to the MSRDC in 2020.
The expressway will connect three districts — Raigad, Thane and Palghar. Its construction will be carried out in two phases. Phase one is a 96.41-km highway between Navghar near Vasai and Balavali near Pen. Phase 2 is a 29.9-km highway between Balavali and Alibaug. The 165-km-long corridor has been planned to decongest traffic in and around Mumbai Metropolitan Region.
Initially planned under the EPC model, the project faced a major setback when bids for its first phase came in nearly 36% higher than the estimated cost.
In May 2024, MSRDC split the tender into 11 packages, and seven infrastructure companies were declared the lowest bidders. These included Larsen & Toubro (L&T), Navayuga Engineering Company (NECL), Oriental Structural Engineers (OSE), IRCON International, J Kumar Infraprojects (JKIL), Megha Engineering and Infrastructures (MEIL), and Welspun Enterprises (WEL).
While the quoted price for these packages was Rs 19,334 crore, the contracts were awarded at Rs 26,300 crore.
However, with the new government helmed by Chief Minister Devendra Fadnavis, a decision has been made to review the tenders. The government is now contemplating implementing the project under the BOT model. Under this model, a private entity is granted a concession to finance, design, and construct the infrastructure. After construction, the private party operates and maintains the facility for a specified period to recover its investment and earn a profit, usually through user fees or tolls.
'After all financial considerations regarding the corridor project, we have proposed the BOT model to the government. While we are working on land acquisition, we await the government's response to the proposal,' Anilkumar Gaikwad, Managing Director of MSRDC, said.
The total estimated cost of the 165-km corridor is Rs 66,000 crore, of which Rs 22,300 crore is earmarked for land acquisition. Officials said that under the old model that was envisaged by the MSRDC it had been difficult to raise money from institutions to fund the project because of which a change in approach is now being contemplated.
A proposal to this effect has been submitted to the state government which is expected to give its go ahead for calling of fresh tenders.
