IL&FS bows out, govt to invite tenders for Zojila tunnel for the third time

14.2 km Length of the bi-directional single tube tunnel, which will be India's longest

The Union government is set to invite tenders for a third time for its ambitious Zojila tunnel project in Jammu and Kashmir as crisis-hit Infrastructure Leasing & Financial Services (IL&FS) has surrendered the Rs 6,809-crore contract it bagged in 2017. The National Highways and Infrastructure Development Corporation (NHIDCL), a wholly owned subsidiary of the road ministry, has begun work for rebidding the project, which is aimed at providing all-weather connectivity between Srinagar, Kargil and Leh. 

It is learnt that bids will be invited before the dates for the general election are announced. According to an official in the know, the decision to retender the Zojila project was taken after IL&FS offered to surrender the project, construction on which was yet to commence.

Even though no official communication regarding surrender or retender has been exchanged between the board of IL&FS and the Ministry of Road Transport and Highways, NHIDCL has been informally given the task of inviting fresh bids, the official quoted above said.

In October 2018, the central government took control of the management of IL&FS after the firm defaulted on debt.

The new board of IL&FS is headed by Uday Kotak, managing director, Kotak Mahindra Bank. 

In July 2017, IL&FS emerged as the lowest bidder after the second round of bidding for the proposed 14.2-km tunnel. In January 2018, IL&FS Transportation Networks received the letter of acceptance from NHIDCL for project construction.

The civil construction cost of the project is Rs 4,899 crore and the total capital cost of the project is Rs 6,809 crore, which includes the cost towards land acquisition, resettlement and rehabilitation, pre-construction activities, and maintenance and operation.

In March 2016, Union Road Minister Nitin Gadkari had ordered retendering of the project, which was awarded to IRB Infrastructure, after Congress leader Digvijay Singh alleged that guidelines were violated while awarding the contract. 

The Zojila pass is situated at an altitude of 11,578 feet on the Srinagar-Kargil-Leh National Highway, which remains closed during winter (December to April) because snowfall and avalanches cut off the Leh-Ladakh region from the rest of Kashmir. Once completed, the Zojila tunnel would be the country’s longest road tunnel, with strategic and socio-economic importance.