First Phase Of Kerala Expressway By 2006

The first phase of the proposed 507-km Kasargod-Thiruvananthapuram Express Highway will be completed by 2006.

The entire project at a cost of Rs 6,400 crore will be completed by 2012, according to Kerala public works minister M K Muneer.

Maintaining that the 140-km stretch from Malappuram to Ernakulam would be given priority and completed in the first phase as that sector has the highest internal rate of return, the minister said the expressway would pass through 890 hectares of agricultural land, 2,900 hectares of plantations and 238 hectares of residential area. More than 3,000 families will have to be rehabilitated.

Disclosing that the report on financial structuring of this 100-meter wide access-controlled high-speed corridor is likely to be submitted within two weeks, Muneer said the work on the project would start only after preparing an action plan for rehabilitation and resettlement of those who have to be displaced.

Around Rs 1,758 crore would be needed for land acquisition, resettlement and rehabilitation of the displaced, out of which Rs 1,500 crore has already been provided. The cost of construction has been put at Rs 3,877 crore and overheads at Rs 765 crore, he added.

Though the financial structuring report is being prepared by the Infrastructure Development Finance Corporation of India, the Infrastructure Leasing & Finance Corporation of India and SBI Caps, the final decision on this will be taken by the state Cabinet, the minister said.

Pointing out that a study conducted by Lea Associates South Asia Pvt Ltd confirmed that the project was technically, economically and financially viable, the minister said an economic analysis by the Roads and Bridges Development Corporation of Kerala Ltd (RBDCK) had shown that the internal rate of return of the expressway could be as high as 70.73 per cent including savings in vehicle operating costs, value of time, employment in construction and gains from activity nodes to be built around 19 interchanges on the route.

Revealing that the funds required would be mobilised by a special purpose vehicle to be created for implementing the project, Muneer said the Kerala government would hold a 50 per cent stake in the total equity of that company.

The state government and the strategic partner would share the equity at Rs 696 crore each, an RBDCK official said.