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APCO Infra bags Rs 2,378 crore tunnel project in J&K

The Rs 2378-crore project, initially awarded to the now-troubled IL&FS, had been in stasis for about a year

Gurgaon, APCO Infratech, Z-morh tunnel, Jammu & Kashmir, IL&FS, NHIDCL, Srinagar, Kargil, Ashoka Concessions, Chetak Enterprises, NCC, Build-operate-transfer, BOT, Road transport, Highway, Road transport and highways ministry

Gurgaon-based APCO Infratech has won the contract for the strategic Z-morh tunnel in Jammu & Kashmir, a first step in restarting an under-construction project which was put up for rebidding following uncertainty over its completion date.

The Rs 2,378-crore project, initially awarded to the now-troubled Infrastructure Leasing & Financial Services (IL&FS), had been in stasis for about a year. Amid the uncertainty regarding its progress, state-run National Highways & Infrastructure Development Corporation Limited (NHIDCL) had terminated IL&FS’ contract and invited fresh bids for it in June this year.

The 6.5-km-long Z-morh tunnel will provide all-weather connectivity between Srinagar and Kargil.

APCO Infra emerged as the lowest bidder for financial bids that opened on Thursday.

NHIDCL had received bids for the project from four companies in the techno-commercial bid stage. As per the minutes of the meeting of the empowered technical bid evaluation committee, NHIDCL said that technical bids were received from APCO Infratech, Ashoka Concessions, Chetak Enterprises and NCC.

The tunnel is being constructed on build-operate-transfer (BOT) model which the government is trying to revive after having received lack-lustre response from investors for almost four years.

In BOT projects, private sector developers build a road with their own funds, operate it and then transfer it to the government after a specified period.

Work on the project had been stuck since July 2018, and NHIDCL is now in the process of resolving it based on the guidelines issued by the road transport and highways ministry in March this year.

IL&FS has completed about 30% of the work and is likely to be paid Rs 420-450 crore for it. The letter of award will be given to APCO Infra in the next few months, after the company lists out its mode of funding the project to the government.

The remaining work on the tunnel is expected to be completed in 3.5 years from the date of award of the contract.

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June 2020
10 Jun 2020