Maharashtra: Cabinet nod to develop Phase 1 of Virar-Alibaug corridor on BOT Model

Indian Express

17-06-2025

The Maharashtra Cabinet on Tuesday gave approval to develop the first phase of the ambitious Virar-Alibaug Multi-Modal Transport Corridor, a 165-km arterial route designed to reduce congestion in Mumbai Metropolitan Region, on a Build-Operate-Transfer (BOT) model by the Maharashtra State Road Development Corporation (MSRDC).
The state government has decided to scrap the previous bids floated for the project as the rates of construction bids for its first phase have sharply inflated.
The corridor is one of the largest road infrastructure projects in the MMR and is designed to serve as an important route for vehicles entering Maharashtra from Gujarat and North India.
It will provide direct connectivity to the Jawaharlal Nehru Port Trust (JNPT), decongesting existing routes through Thane and Palghar districts and easing traffic in the suburbs.
Initially, the MSRDC had floated tenders worth Rs 19,334 crore for the construction of the first phase, split into 11 packages. However, contractors quoted 36 per cent higher rates than expected, inflating the cost to Rs 26,000 crore.
Even after detailed scrutiny by Veermata Jijabai Technological Institute, comparison with central and state rate books, and prolonged negotiations, the final cost remained close to Rs 25,000 crore, prompting sharp criticism and stalling of approvals.
Compounding the problem was the difficulty in raising funds for the project.
After considering all these aspects, in March 2025, Chief Minister Fadnavis recommended adopting the BOT model to reduce the financial burden on the state.
Under this model, a private developer will build and operate the corridor for a concession period, recover its investment via toll or user charges, and eventually transfer the asset back to the government.
The MSRDC had submitted a revised proposal in April for adopting the BOT model, which has now been approved. The tender floated earlier will now be scrapped.
The first phase of the corridor spans 96.41 km, connecting Navghar in Palghar district to Balavali in Pen taluka.
The Virar-Alibaug corridor is designed to significantly improve regional connectivity by linking the JNPT and the upcoming Navi Mumbai International Airport with key national highways and expressways. These include NH-48 (Mumbai-Ahmedabad), NH-848 (Mumbai-Agra), NH-61 (Kalyan-Murbad-Nirmal), as well as the Mumbai-Pune Expressway, Mumbai-Vadodara Expressway, and the Mumbai-Goa National Highway, among others.
The corridor will pass through Vasai, Bhiwandi, Kalyan, Ambernath, Panvel, Uran, Pen, and Alibaug, offering a crucial alternative route to decongest Mumbai and promote planned urban expansion.
To facilitate the project, the Cabinet approved a financial provision of Rs 22,250 crore for land acquisition, along with Rs 14,763 crore towards interest, bringing the total estimated budget for Phase 1 to Rs 37,013 crore.
Land for Tribal Industrial Cluster
The Cabinet also approved the transfer of 29 hectares and 52 acres of land at Jambutke village in Nashik district to the Maharashtra Industrial Development Corporation (MIDC) for the development of a Tribal Industrial Cluster.
This decision aims to provide land plots to aspiring entrepreneurs from the tribal community to help them set up industries. The move is expected to boost employment opportunities and economic development in tribal areas.
As per the decision, the identified land in Jambutke will be officially handed over to MIDC for the establishment of the cluster, which is part of the state government's broader strategy to promote inclusive growth and empower tribal populations through industrial development.