SREI awaits response on Coastal Expressway

Kolkata-based leading infrastructure company, SREI Infrastructure Finance Limited (SIFL), is awaiting the response from the Orissa government on its proposal for construction of an Elevated Coastal Expressway connecting Digha in West Bengal with Gopalpur in Orissa.

Though the exact cost of the project has not been worked out, the approximate investment in this project is likely to be Rs 25,000 crore to Rs 30,000 crore.

It is expected to provide an alternative route for carrying out trade and commerce in the state, providing partial protection from Tsunami and other sea hazards. Besides, the expressway will reduce the distance between Digha and Gopalpur by about 200kms.

As it will be an Elavated Coastal Expressway project, this will require hybrid structure and creation of a land bank.

This project is proposed to be implemented on BOT ( Build-Own-Transfer) basis in the public-private-partnership (PPP).

“The Orissa government is evaluating the proposal and we are awaiting its response”, K K Mohanty, executive director, SIFL, told Business Standard. He said, Orissa is one of the focussed states for the SREI Infrastructure and the company is associated with a number of projects in the road, port, aviation sectors. It is bidding for 8 patches of National Highways passing through Orissa.

The company started its business from Orissa and has been associated with the infrastructure development of the state since a long time.

Once the state government approves the project, the company will form a Special Purpose Vehicle (SPV) for implementation of this project.The SPV will have construction,technical and finance partners and will be instrumental in mobilisation of funds. SIFL may rope in both local and international partner for executing the project.

“The local partner will take up construction work and the international partner will bring in expertise”, Mohanty added.

The company, which is a 70 percent stakeholder in the Creative Port Development Private Limited (CPDPL), hopes to start the construction of Kirtania port in the mouth of the river Subernarekha from October.

The company is also interested in the mines operations and supplying infrastructure equipments in the mining belt. It has already given a proposal to the state owned Orissa Mining Corporation (OMC) for setting up a joint venture for mining and coal raising.

The scope of the proposed joint venture may not be confined to the state and a technical partner may be roped in. However, the shareholding pattern and other details has not yet been worked out.

D K Vyas, the chief executive officer (CEO), SREI-BNP PARIBaS said, the company is targeting Rs 10,000 crore equipment financing during 2008-09 compared to Rs 6000 crore last fiscal. Though the infrastructure sector has witnessed a slow down, the company hopes to achieve the target.