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Gaurav Raghuvanshi

New Delhi , Dec. 15

THE Kandla Port Trust and Gujarat Adani Ports Ltd (GAPL) will have an equity stake of 26 per cent and 20 per cent respectively in the special purpose vehicle (SPV) that is to execute the 313-kilometre Gandhidham-Palanpur gauge conversion project in Gujarat.

Billed to be the longest gauge conversion project being executed through the SPV route, the Rs 454-crore gauge conversion project will connect the Gulf of Kutch with the Delhi-Ahmedabad broad gauge link. The line will provide connectivity for north India with Kandla and GAPL's Mundhra ports.

"The distance between Delhi and the Kutch region will reduce by 114 kilometres. Apart from Mundhra and Kandla ports, the local salt industry, Indian Oil Corporation's depot and Iffco's fertiliser plant at Kandla will benefit from the reduced distance," a senior Railway Board official told Business Line.

The equity structure of the proposed SPV has already been finalised and the draft memorandum of understanding sent to the stakeholders for approval, the official said.

The Ministry of Railways will chip in with Rs 100 crore as 50 per cent equity in the SPV, while the Gujarat Government will hold the balance 4 per cent. The company will have an equity base of Rs 200 crore and the rest will come in the form of loans, he said.

The Government had earlier cleared the detailed estimates for the project at Rs 344.63 crore but the final cost of the project now works out to Rs 454 crore, after accounting for financing charges and inflation, the official said. The project is likely to be completed in three years.

Apart from the Gandhidham-Bhildi-Palanpur link, the Gujarat Government is also pushing for conversion of the Bhildi-Raniwara (150 km) track and development of the Viramgam-Bhildi (157 km) link that would connect Kutch and Saurashtra to the Jodhpur-Bhatinda link and provide a new access to north India for Gujarat.

This would be the third parallel track to northern India from the West Coast.

Meanwhile, the 67-km Mundhra-Alipur line was inaugurated on Saturday by the Gujarat Chief Minister, Mr Narendra Modi. The link, built by the Ahmedabad-based Adani Group, is the longest railway line developed by a private company in the country.

Gujarat also boasts of the first railway line developed in the country under the SPV route. The Pipavav Rail Corporation Ltd, a 50:50 joint venture between the Ministry of Railways and Gujarat Pipavav Ports Ltd, had commissioned the 270-km broad gauge link between Surandranagar and the port earlier this year.

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