The state government will bear the entire cost of acquiring about 3,500 acres of land – which is required for the formation of 74-km peripheral ring road (PRR) project – by raising a bank loan. The decision was taken at a meeting chaired by Chief Minister Siddaramaiah on Wednesday, providing a much-needed fillip to the long-pending project that aims to decongest Bengaluru’s peripheral areas.
The move comes at a time when the Bangalore Development Authority (BDA) is unable to find bidders for executing the Rs 27,000-crore project, where the private player was expected to fund land acquisition and construction cost. In search of bidders, the BDA lost about two years as it floated multiple tenders only to find no response.
In his statement, Siddaramaiah said the BDA has been directed to place various financial modules to fund the project in the state Cabinet. The government, it is learnt, will bear the entire land acquisition cost, which is more than 80% of the project cost, by raising a loan. The construction cost is likely to be funded by Japan International Cooperation Agency (JICA), sources said.
At the meeting, Revenue Minister Krishna Byre Gowda reportedly backed the idea, stating that depending on private players to fund land acquisition could delay the project. He also cited the National Highways Authority of India which has been following the same model.
It is learnt that the government plans to repay the loan by auctioning land along the PRR when the value goes up. It also plans to provide a higher floor area ratio along the stretch for better returns.
To cut down land acquisition cost, the government may reduce the PRR’s width to 50 metres. The stretch will include eight lanes of main carriageway and two service lanes. The original plan was a 100 m wide expressway with space for cyclists, greening, wide median etc.
Sources said the meeting was initiated by Deputy Chief Minister D K Shivakumar.
Published 17 July 2024, 21:03 IST