Last month, Prime Minister Narendra Modi sounded the Bharatiya Janata Party's bugle for the Uttar Pradesh assembly elections in a rather unique manner. He landed on a 3,300-metre-long airstrip near Kurebhar in Uttar Pradesh's Sultanpur district, built as an emergency runway for the Indian Air Force as part of the newly-constructed Purvanchal Expressway.

The Prime Minister was in the state to inaugurate the Purvanchal Expressway, which links state capital Lucknow with some of the most under-developed districts in the eastern part of the state, close to the boundary with Bihar.

Just weeks later, the Prime Minister is set to lay the foundation stone for the state's sixth expressway. He will be in the Saharanpur district of western Uttar Pradesh tomorrow (18 December) to attend the bhumi pujan ceremony for the construction of the 594-kilometre-long greenfield Ganga Expressway, which will be the state's longest expressway.

In the first phase, the Ganga Expressway will link Meerut in western Uttar Pradesh with Prayagraj in the east, passing through 10 other districts of the state — Hapur, Bulandshahar, Amroha, Sambhal, Badaun, Shahjahanpur, Hardoi, Unnao, Rai Bareli and Pratapgarh. Meerut is linked to Delhi through the 96-km-long, 14-lane Delhi-Meerut Expressway.

In the second phase, the expressway will be extended to Varanasi.

The technical and financial bids for the constriction of the expressway were opened late last month. The project, divided into four groups in the first phase, has been awarded to IRB Infrastructure Developers and the Adani Group.

While IRB Infrastructure Developers will build the 129.7-km stretch of the expressway between Meerut and Amroha, the Adani Group will construct the other three stretches — 151 km from Badaun to Hardoi, 155 km from Hardoi to Unnao, and 156.947 km from Unnao to Prayagraj.

While the recently completed Purvanchal Expressway and the under-construction Bundelkhand and Gorakhpur Link expressways were built under the Engineering-Procurement-Construction or EPC model, in which the state government funds the entire cost of the project, the Ganga Expressway is a Public-Private Partnership project being built on Design-Build-Finance-Operate-Transfer or DBFOT model.

Over 94 per cent of the land needed for the expressway has been acquired "in record time, despite the second wave of Covid-19", Uttar Pradesh Expressways Industrial Development Authority (UPEIDA) said, adding that 90 per cent of the land was purchased in four months.

In August this year, UPEIDA secured a loan of Rs 5,100 crore from the Punjab National Bank, which was used for the acquisition of land for the Ganga Expressway, among other things.

The UPEIDA obtained the loan in lieu of the securitisation of its toll revenue, which has risen significantly over the last few years and is expected to grow further with the operationalisation of the Purvanchal Expressway.

"In the Ganga Expressway project, we are using securitisation money from our toll incomes for a loan at very soft terms, "Awanish Awasthi, Chief Executive Officer (CEO) of UPEIDA, told Swarajya, adding, "The interest on the securitisation loan is very low. It is less than 7 per cent".

"We have taken the securitisation route because our toll is increasing by 30 to 40 per cent every year. We wanted to leverage the increase in toll with us rather than leaving it to other organisations," Awasthi said.

For its operational expressways, including the Lucknow-Agra Expressway, UPEIDA gives toll collection rights to private companies. These companies transfer a portion of the revenue generated from toll to the agency.

In 2020, the Uttar Pradesh cabinet had approved a new agency for collecting toll tax on the Agra-Lucknow Expressway. UPEIDA had fixed the reserve amount for toll collection at Rs 274 crore for the bidding process. Sahkar Global Limited, the agency selected for toll tax collection, had quoted a figure of Rs 402 crore, which was highest among the seven bidders and nearly 82 per cent more in comparison to the company selected for toll collection on the Lucknow-Agra Expressway in 2018.

"We have used our money from securitisation [of toll revenue] for retiring of a costlier loan [Rs 819 crore outstanding loan in Agra-Lucknow expressway] which was taken earlier. We have used a part of the securitisation money for buying the land for us. The total amount [of the loan] is Rs 5,100 crore and we have as yet used about Rs 2,000 crore from it," UPEIDA CEO Awasthi told Swarajya in Lucknow, adding, "It is probably one of the largest securitisation loans in the country against toll."

"In case of securitisation, the risk is not on the financer or the bank because the revenue which comes through toll collection on expressways is put in an escrow account and that is used to pay for our interest as well as principal. If there is a shortfall, it has to be met by us," he said.

Awasthi told Swarajya that the construction of the Ganga Expressway would start within the next six months, and the project would be complete in three years after the construction begins.

Last month, the Ganga Expressway project received clearance from the state-level Environmental Impact Assessment Authority, necessary to start work. The environmental clearance for the project came nearly 12 years after the Allahabad High Court cancelled the permission obtained by the Mayawati-led Bahujan Samaj Party government in 2007 in 2009.