IRB awarded Rs10,050-cr J&K tunnel project

IRB Infrastructure Developers has bagged a Rs10,050-crore order to construct the Zozila pass tunnel in Jammu & Kashmir. The scope of the project includes constructing approaches on NH-1 (Srinagar Sonmarg- Gumr-i Road) on a design, build, finance, operate and transfer (annuity) basis.

The company has received a letter of award from the ministry of road transport and highways for the construction, operation and maintenance of Zozila pass Tunnel in Jammu ands Kashmir, the longest tunnel in South-East Asia, the company said in a statement issued to exchanges said.

The project involves construction of a tunnel spanning a length of 14.08 km - the longest in South-East Asia.

Besides, it involves construction of 10.8 km of approach roads with three vertical ventillation shafts.

The estimated cost of thye project is Rs10.050 crore and the concession period is 23 years, including construction period of seven years.

The company will receive semi-annual (twice a year) annuity of Rs981 crore from the ministry of road transport and highways after completion of the project.

The project has strategic and socio-economic importance for the people of Jammu and Kashmir and Leh-Ladakh as the National Highway NH-1 remains cut off during winter season due to heavy snowfall in and around Zoila Pass.

The project, when completed, would give all weather connectivity between Jammu and Kashmir and Leh-Lakadah and hence assumes national importance.

This would also be the biggest highway project, in terms of project cost.

"It is the biggest national highway project awarded in India in terms of project cost with a tunnel length spanning 14.08 km and costing of Rs 10,050 crore," company's chairman and managing director Virendra Mhaiskar said.

The scope of the project includes constructing approaches on NH-1 (Srinagar Sonmarg- Gumr-i Road) on design, build, finance, operate and transfer (annuity) basis.

"This project has a strategic and socio-economic importance as it will provide much needed all weather connectivity between J&K and Leh-Ladakh, which remains cut off during winter due to heavy snowfall and hence assumes national importance," Mhaiskar said.

The project also involves construction of 10.8 km approach road with three vertical ventilation shafts, snow gallery of 700 meters and avalanche protection measures.

The construction of the tunnel is scheduled to be completed in seven years and the concession period is 22 years.

Assuming a 75-25 debt equity, the project will net an internal rate of return of about 16 per cent.

With this order, IRB expands its base to the ninth state. The company's order book now stands at Rs16,430 crore.