German Bank KfW extends 545 million Euro funding to MMRDA infra projects – ET RealEstate

MUMBAI: The Frankfurt-based German state-owned development bank KfW has extended two loans totaling over 545 million Euros or Rs 4,767 crore to the Mumbai Metropolitan Region Development Authority (MMRDA) for infrastructure projects in Mumbai.

The funds to be disbursed through an agreement with India’s Ministry of Finance will be utilized to support two key mass transit projects in Mumbai. These projects are Metro line 4 from Wadala in central Mumbai to Kasarvadavli in Thane, and Metro line 4A that extends to the connectivity from Kasarvadavli to Gaimukh in Thane.

The fully elevated lines will have a total length of 34.82 km with 32 stations easing the distress of millions of commuters each day and help provide a cleaner, less congested city.

“Though it is good to take decisions to start mega transportation projects, which are very much required in Mumbai, it is more important to achieve financial closures and provide all support to project authorities like making available the required land etc, without which projects can’t be completed. I am happy that now Lines 4 and 4A do not have any major hurdle and hope that these will be completed on time,” said Maharashtra Chief Minister Uddhav Thackeray.

The credit package consists of a development loan of 345 million Euros and a promotional loan of 200 million Euros. The loans will have tenure of ranging from 15 years to 20 years with a grace option of five years.

According to R. A. Rajeev, Commissioner MMRDA, which is implementing the projects, the approved funds will cover system components for Mumbai’s Metro Line 4 and 4A, footpaths and cycle routes surrounding the stations to improve integration within the transport system. The 34 kilometers long Metro Line 4 will bring north-south connectivity, linking Mumbai to Thane.

“MMRDA is also working for mitigation of climate change by executing Metro projects across Mumbai Metropolitan Region. Once metro line 4 and 4A have begun operations, it will help save up to 121,000 tonne greenhouse gases every year, besides ensuring reduction in air pollution,” Rajeev said.

Of the 345 million Euros loan money approved, around 255 million Euros will be used on purchasing rolling stock and on integrated ticketing systems, while 90 million Euros will be utilised on multimodal integration systems.

The 545 million Euros loan amount approved by Kfw is the highest amount given to India ever before that too at the lowest rate of interest offered by any financial institution so far.

The rate of interest for 345 million Euros is 0.29% and 0.07%, while for 200 million Euros debt the rate of interest is 0.82%.

The government of Maharashtra’s body MMRDA is responsible for the infrastructure development of the Mumbai Metropolitan Region. The body is bringing significant development in the public transportation system by building 14 different metro line projects in Mumbai and MMR.

At present, due to no substitute and with just one Metro line in the city that is operational between Ghatkopar and Versova of 11km, commuters are compelled to travel in overcrowded suburban local trains that often lead to accidents.

However, once all metro lines are operational not just it will reduce the burden on local trains but will also relieve strain from commuter traffic, reduce traffic accidents and respiratory problems caused by air pollution and contribute to climate change mitigation.



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One per cent of stamp duty allocated to Mumbai, Pune and Nagpur metros – ET RealEstate

MUMBAI: One per cent of all stamp duty levied on sale and purchase of property in Mumbai, Pune and Nagpur will go towards completion of metro projects in those cities, the government has announced.

The decision comes in the middle of a pandemic-induced slowdown, when all major infrastructure projects in the state are struggling to raise funds.

A notification issued by the Urban Development Department on September 10 said as per the Mumbai Municipal Corporation Act, 1888, and Maharashtra Municipal Corporation Act, 1949, 1per cent of the revenue will be collected by the Stamps and Registration Department and given for Mumbai, Pune and Nagpur metro rail projects. The additional charge will be applicable on all property deals from February 8, 2019, it said.

The government is studying different fundraising models for major infrastructure projects, a department official said. “The stamp duty levied on property will help the projects immediately. The emphasis will be on continuing the projects and completing them within the deadline.”

Mumbai Mirror had reported on September 4 that the Mumbai Metropolitan Region Development Authority (MMRDA) was struggling to raise funds for the metro project. If loans of Rs 29,000 crore do not come through in the next six months, the MMRDA may have to withdraw its fixed deposits of Rs 13,000 crore to fund big-ticket projects.

The planning agency has Rs 1.25 lakh crore tied up in 12 metro corridor projects, including around Rs 60,000 crore in seven under-construction lines and three that are in different stages of planning. Another key project is the Mumbai Trans Harbour Link, estimated to cost Rs 23,000 crore and likely to be completed by 2022.

All of these infrastructure projects are capital intensive. Sources said that on average, the annual expenditure on the projects as well as human resources and ancillaries touches around Rs 7,000 crore.

Pune Metro, which will connect Pune Central and the areas of Pimpri and Chinchwad, is targeted for operations by the next year. Its estimated cost is of Rs 11,420 crore. Nagpur Metro Rail Project will consist of a 38.215-km corridor, 38 stations and 2 depots. It is estimated to cost Rs 8,260 crore and is expected to be completed by 2021.

The stamp duty is the largest revenue earner for the government, after GST and sales tax and VAT. In 2019-20, the state earned Rs 29,500 crore through stamp duty. In 2020-21, it expects to raise only an additional Rs 500 crore.



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Bombay HC tells MMRDA to stop road work on housing society plot – ET RealEstate

MUMBAI: Bombay high court on Tuesday directed MMRDA to “forthwith stop work of road-widening on a plot owned by a housing society” in Kurla (W) after it alleged that the authority took possession of 700 sq metres in a “high-handed manner’’.

The work is for an elevated road corridor from Kurla to Vakola on Santacruz-Chembur link road and MTNL junction, BKC to LBS flyover at Kurla.

Kapadia Development Coop Housing Society argued, through its counsel Rakesh Agrawal, that Mumbai Metropolitan Region Development Authority forcibly took possession of part of its plot for the project. MMRDA counsel Akshay Shinde, admitting that road-widening was on, on the society’s plot, said it was acquired by BMC. But special counsel Anil Sakhare said the project was undertaken by MMRDA and BMC had not acquired the plot.

An HC bench of Justices S J Kathawalla and Riyaz Chagla said that if what BMC stated was correct, MMRDA was not entitled to carry out road-widening by making use of the petitioner’s plot.

HC directed MMRDA to file a detailed affidavit on what basis it submitted to court on affidavit that the plot admitted owned by the society and used for road-widening was acquired by BMC. The matter will be heard next on September 15.

The property abuts Mithi river. The society is not opposing the public project but the manner in which, taking advantage of the lockdown in April, part of its plot was “forcibly taken”.



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MMRDA decides to allot BKC land parcel to Indian Oil Corporation – ET RealEstate

MUMBAI: The Mumbai Metropolitan Region Development Authority (MMRDA) has decided to allot Indian Oil Corporation (IOC) a 400-sq m plot in Bandra-Kurla Complex (BKC) next to the land parcel on which the company has constructed its registered office building.

Indian Oil’s registered office building stands on a 1,200-sq m plot in BKC’s C-50 zone that was allocated in April 2004 for a lease period of 80 years.

For the new plot being allotted, a lease for the remaining 64 years will be signed instead of 80 years so that the lease period for the entire 1,600 sq meter plot remains the same.

Japan’s Sumitomo Corporation last year bought a 3-acre plot in BKC for Rs 2,238 crore in what was one of the largest investments by a foreign company in Indian real estate.

While the plot being allotted to Indian Oil is much smaller compared with the Sumitomo land parcel, the company is expected to pay the same rate on a per sq m basis.

“We are not offering any concession to any entity. The land parcel will be allotted to IOC at the last successful auction rate of over 3.44 lakh per sq m achieved through Sumitomo deal in Bandra-Kurla Complex a few months ago,” RA Rajeev, metropolitan commissioner, MMRDA, told ET.

MMRDA is a development authority engaged in longterm planning and implementation of strategic projects and financing infrastructure development in Mumbai metropolitan region (MMR).

As per its regulations, the authority has allowed Indian Oil to pay 30% of the land value in one month and the remaining in another eight months.

The authority has more land parcels available in the business district and may consider auctioning these after the market stabilises, Rajeev said.

According to property consultants, BKC continues to be a sought-after business district and could attract more large global and domestic entities.

Last month, Brookfield Asset Management acquired the Jet Airways office spread over two floors of commercial tower Godrej BKC after the National Company Law Tribunal (NCLT) approved auctioning the immoveable assets of the non-operational airline.



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