NHAI forms wholly-owned SPV ‘DME Development’ for Delhi-Mumbai Expy.

August 17, 2020: National Highway Authority of India (NHAI) has registered a wholly-owned special purpose vehicle (SPV) company by the name of ‘DME Development’ for financing, construction, and operation of the Delhi-Mumbai ‘Greenfield’ Expressway.

By floating SPV specific to a corridor, NHAI is aiming at diversifying its resource base and developing a sustainable and self-liquidating approach to raise finances.

NHAI is currently implementing about 28,000 km under ‘Bharatmala Pariyojna’ Phase-1. Under this, Delhi Mumbai Expressway is one of the flagship highways corridors. Spanning 1,275 km, it will be an 8-lane expressway with provision to expand to 12-lanes in the future, with a design speed of 120 km/hr and will be India’s longest greenfield expressway. The corridor will be completely access controlled with a closed tolling. The completion of the Expressway is projected by March 2024.

A network of 75-way side amenities is also planned on either side of the expressways at an interval of 50 km. The project has a capital cost of Rs 82,514 crore which includes land acquisition cost of Rs 20,928 crore.

“Considering the significance of the project, the authority has decided to invest the full equity and proceed with the development. SPV shall raise debt on its balance sheet, while NHAI retains the operational control during construction and O&M. In addition, the toll on the projects housed in SPV shall be collected by NHAI and SPV shall get the annuity payments without any construction and tolling risks. NHAI plans to form similar SPVs for other high-value highway projects,” said the release.