The Economics Of Mumbai-Nagpur Expressway

  • Excerpts from a conversation with R L Mopalwar, managing director and vice-chairman of Maharashtra State Road Development Corporation, on the various aspects of the Maharashtra Samruddhi Corridor.

One of the ambitious projects that Maharashtra State Road Development Corporation (MSRDC) is focusing on is the Maharashtra Samruddhi Corridor. This project is known to be the pet project of Chief Minister Devendra Fadnavis and promises to connect Eastern Maharashtra with Western Maharashtra. Despite the economics that supports the project, there has been a big hue and cry when authorities started approaching farmers and tribal communities to buy land.

The project which was approved in 1999, has seen many pit stops.

But now with start of land acquisition, R L Mopalwar, managing director and vice-chairman, MSRDC looks optimistic about completing the project by 2019. Mopalwar, who has (among other postings) served as chief executive officer of rural development at Hingoli; director of water resources at Pune and general manager at Transport Department (Pune), believes that the present government has given Samruddhi Corridor the much-needed direction.

MSRDC: Executors Of Infrastructure Projects In Maharashtra

The MSRDC has successfully executed projects like the Mumbai-Pune Expressway; Bandra-Worli Sealink; 32 bridges (of the 55 bridges in Mumbai) among others. Thus, MSRDC was selected for Mumbai-Nagpur Expressway (Maharashtra Samruddhi Corridor). MSRDC – established in 1996 – has executed projects worth Rs 25,000 crore, and total projects at an advanced stage is around Rs 80,000 crore.

Infrastructure is the key, and this was recognised by the National Democratic Alliance government in 2001-2004. In four years, we had four national highways – Delhi-Mumbai, Mumbai-Chennai, Chennai-Kolkata and Kolkata-Delhi – measuring 5,700 kilometres. They were collectively referred to as the Golden Quadrilateral (GQ).

That infrastructure changed the country. We expect the Samruddhi project to do the same for Maharashtra what the GQ did for India.

Despite the 2008 global financial crisis, we survived because we had the GQ infrastructure in place and had other such projects at hand. In the transport sector, roads have enjoyed a pre-eminent position. Around 70 per cent of freight traffic and 85 per cent of passenger traffic takes place on roads. The freight growth is 7.6 per cent which is extremely robust.

The bottleneck is that our freight travels at 250 km a day, while the world average in developed countries is 800 km a day. Jawaharlal Nehru Port (JNPT) is very important as the whole of central India wants to come to JNPT and does not want to go to Vizag because of the Naxal issue. To cover this distance of 800 km, freight in India takes anywhere between 36 to 48 hours. This time span has to be reduced. It is estimated that the cost of transportation in the selling price of any product is six times higher due to such bottlenecks and inefficiencies.

South Korea Is One-Third Of Maharashtra

South Korea is 100,210 square kilometres and Maharashtra is 307,713 sq km. South Korea is almost equal to Vidarbha, which is 97,321 sq km. The density of population in Korea is one-and-a-half times that of Maharashtra and agricultural land is much less. South Korea has 30 per cent of agricultural land, and Maharashtra has 70 per cent agricultural land. In 1972, they started their expressways but today, if you look at the length of their expressway it is around 5,000 km whereas Maharashtra has 95 km of the expressway.

Infrastructure Position

When the present government came to power, Maharashtra had barely 5,000 km of roadways. At the beginning of last year, it was 7,400 km. Now, it will touch 20,000 km soon. This figure is only about Maharashtra.

In 2001, the whole of the country had 55,000 km of national highways. Once Maharashtra will have 20,000 km of highways, it will bring in investments.

Bird’s Eye View Of Samruddhi

There are six main division in Maharashtra – Nagpur, Amravati, Aurangabad, Nashik, Pune and Konkan. If you look at the western part that is Konkan region, you will see that it is already very well connected and is an affluent region. The rest of the state could have been affluent too if infrastructure was in place. The reason more than 50 per cent of Maharashtra remains underdeveloped is that there is no proper infrastructure that connects that part of the state to the developed parts.

For any investor or company, infrastructure part plays a huge role. If they want to go to the countryside, they cannot as there is a lack of infrastructure that connects them to the region. Almost 60 per cent of industrial production takes place in the western part of this state. This is where 90 per cent of the IT firms are present. On the other hand, the eastern part comprising Nagpur, Amravati and Aurangabad (which accounts for more than 50 per cent of Maharashtra) does not have major industries or IT firms. These regions account for more than 90 per cent of mineral deposits of the state, 90 per cent forest (100 per cent of paper production) and 60 per cent steel. All these resources are there in the eastern part, but all the benefits are there in the western part. This project is about empowering the eastern Maharashtra. It also empowers the west by reducing transportation costs.

This road is not just a road but a way for sustainable development of Maharashtra and not just about Mumbai, Pune and Nashik.

The road will run through 65 per cent of agro-based areas. Thus agro-based industries will generate more employment in those pockets of Maharashtra. It will generate wealth for these regions, build robust infrastructure and decrease migration to cities. If a farmer gets non-farming work in his area, then it will reduce migration.

After the success of expressway, we will not just have around 800 km of highway but this state will have 5,000 km of expressways. If this expressway succeeds, the southern portion of Maharashtra will be connected as well with smaller roads and not through expressways. We have already issued work orders for cement or concrete-based roads (in the southern region) that are three- to four-lane projects.

After implementation, vehicles can move at 150 km per hour speed. It will have vehicular passes or crosses, pedestrian crosses, flyover, CNG/PNG pipeline, CCTV monitoring, etc. It will also connect dry ports of Jalna and Wardha.

Our tender process is already out. The time period to finish the project is two-and-half years.

Dedicated Freight Corridor: Don’t Touch Area

Everyone wants to do everyone else’s job. I decided not to fall into that trap. I will do what I am doing. This (dedicated freight corridor) thought was there right from the beginning. To get permission from highways and railways is very difficult. If you talk about expressway and railways together, it will take 10 years to get composite permission. The government of India had appointed a consultancy to study dedicated freight corridor and to combine railway and expressway. The feasibility report stated this is not possible.

On Town Planning Path

Along the Mumbai-Pune expressway, there are unorganised and unplanned clusters like the ones at Khalapur. To prevent the eruption of unplanned structures, we are planning townships along the Samruddhi corridor. We are hoping to have around 24 such townships, but as of now, only 18 have been notified. These would be minimum 400 hectares of townships and developing will be an ongoing process spanning some 20 years. These townships will have cold chains, godowns, hospitality infrastructure and other logistics requirements. By creating these facilities, we will generate jobs. Each node will employ at least 25,000 people. The consultancy firm that was hired to prepare a report on town planning stated primary employment of 30,000 people and secondary employment of 60,000 people per node.

Challenges In Land Acquisition

Our land measurement work is over, and rates have been declared. Purchase of land in Jalna, Nagpur, Vashi, Thane and some places have already started. People in the country are not ready for an open-minded discussion. Whenever there is a project, there is always opposition. Whatever you say they call you mercenary agents (dalal). These people are not ready for peaceful discussion; they harass government officials.

In such a situation, only money works, and we are offering farmers fabulous compensation for their land. Initially, we presented all the plans to the delegates who came to visit us. We also showed them our plan to develop the region from where the expressway will pass, but they were not impressed. We gave them offers of being partners and also having placement cells. These things too did not matter. But at the price at which we are ready to purchase land directly from landowners, we have begun getting excellent results. We pay only to land-owners, and not to brokers. The money is directly paid into the bank account of the land-owner. Of course, the middlemen are upset. But ours is a much better system for ensuring that the money goes to farmers.

In case of Thane, tribal community members are queuing up because in the past a member of the tribe would get Rs 2-3 lakh from the land sharks. But now they get Rs 30 lakh per acre to Rs 2.34 crore from us. Now, the farmers or tribal communities are getting money directly. The land is getting acquired. It is a huge exercise.

This interview was first published in Free Press Journal and has been republished here with permission.