Mumbai sea link: State may seek shorter toll levy period

The Maharashtra State Road Development Corporation (MSRDC), the nodal agency for the Rs 6,000-crore, 22-km sea link between Sewari and Nava Sheva, may ask Mukesh Ambani-controlled SeaKing Infrastructure Ltd (SKIL)-led consortium to bring down the concession period it is demanding.

The concession period is the duration during which the consortium will collect the toll.

The MSRDC board, which is chaired by state Public Works Minister Anil Deshmukh, will meet on Thursday to forward its final recommendation to the Cabinet Committee on Infrastructure (CCI).

The SKIL-IL&FS consortium was left as the sole bidder for the project after Anil Ambani-led REL-Hyundai consortium pulled out of the bid last week.

REL, in its bid, had sought a concession period of only nine years and 11 months, while SKIL has demanded 75 years. This has put the state government and the MSRDC in a quandary as they feel that the concession period demanded by both the bidders is unrealistic.

During a meeting with the Cabinet panel last week, the MSRDC had given four options, including awarding the project to REL-Hyundai consortium, which was declared the preferred bidder this February, or go for re-tendering. Other options included asking both the bidders to submit their bids once again and the MSRDC building the project on its own.

This was followed by Chief Minister Vilasrao Deshmukh asking the MSRDC to come up with a firm recommendation for the Cabinet panel.

"Since the REL-Hyundai consortium has not submitted the letter for extending the validity of its bid, the bid is no longer valid. So there is no question of awarding the project to it (consortium)," a senior official from the public works department told Business Standard.

Now, the MSRDC board can ask SKIL and IL&FS to bring down the concession period, go for re-tendering or build the link itself, the official added.

According to MSRDC's estimates, it will take around 44 years for the bidder to recover the investment and start making a decent profit.