The National Highways Authority of India has proceeded to form a Special Purpose Vehicle Company to finance the construction and operation of the Delhi-Mumbai Greenfield Expressway which is projected to be completed by March 2024.
"The SPV has been registered by the name of DME Development Ltd and will be wholly owned by NHAI. By floating SPV specific to a corridor, NHAI is aiming at diversifying its resource base to develop a sustainable and self-liquidating approach to raise finances," an NHAI official said.
Spanning 1,275 km, it will be an 8-laned expressway with the provision to expand it into 12-lanes in the future. It will be India's longest Greenfield Expressway with a design speed of 120 km/hour. The corridor will be completely access-controlled with a closed tolling.
"It is currently implementing about 28,000 km under Bharatmala Pariyojna Phase-1. Under this, Delhi-Mumbai Expressway is one of the flagship highways corridors," the official said.
A network of 75-way side amenities is also planned on either side of the expressways at an interval of 50 kilometres. The project has a capital cost of ₹82,514 crores which includes land acquisition cost of ₹20,928 crore.
Considering the significance of this project, the authority has decided to invest the full equity and proceed with the development.
SPV shall raise debt on its balance sheet, while NHAI retains the operational control during construction and O&M.
In addition, the toll on the projects housed in SPV shall be collected by NHAI and SPV shall get the annuity payments without any construction and tolling risks. The completion of the Expressway is projected by March 2024.
NHAI is also planning to form similar SPVs for other high-value highway projects. This will further enhance NHAI capabilities to execute large scale infrastructure projects of national importance, the official added.