The Vijayawada-Machilipatnam four-lane project is coming back to the square one as the Madhucon Infra Limited, which bagged the project contract, could not achieve the target financial closure as it assured the National Highways Authority of India (NHAI).

The Madhucon again urged the Authority to give ‘grace time’ of another two months. The NHAI Board is yet to take a decision in this regard. The Authority gave time to Madhucon up to December following its assurance that it would achieve the financial closure by December 2013.

The Authority enchased nearly Rs.12 crore deposited by the Madhucon in view of the delay. The firm has to pay about Rs.1 lakh per day for its inability to execute the project as per the schedule. Now, the NHAI, sources say, is likely to go for fresh bidding to take forward the project. The Authority served the termination notices to Madhucon in September last year.


With this, the status of ambitious project is back to the square one and the Authority has to go through rigmarole of inviting fresh tenders if the Board does not agree for reconciliation.

On other hand, the NHAI could complete the land acquisition in a majority of portions except in places like Poranki and Kanuru. The NHAI has to acquire 212 hectare land for the project. Of this about 20 hectare acquisition is remaining, sources say.

There is an inordinate delay in execution of the project ever since it was conceived. The land acquisition, change in plans and lack of enthusiasm from infra companies were some of the stumbling blocks. At a point of time, the NHAI authorities, in 2010, decided to shrink the proposal of four-lane to just two lanes.

Flyover at Benz Circle

The NHAI officials stated they had to alter the four-lane project to two-lane with paved shoulders, as no contractor evinced interest in taking up the former. The authorities then stated that the cost would come down by at least Rs.100 crore, while initial estimates were put at Rs.480 crore.

Even that proposal did not take off. The 64-km stretch four-laning project now costs Rs.606 crore. A flyover at Benz Circle is also proposed in the project.

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