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Who pays for the Bandra-Worli sea link?

with 2 comments

From ET:

After years of delays and legal wrangling, India’s first “sea bridge” opens to traffic this week, aiming to ease chronic congestion on Mumbai’s notoriously choked roads.

It is hoped that the 16.5-billion-rupee (340-million-dollar) eight-lane freeway will help cut the 40-minute journey between the suburbs of Bandra and Worli to just eight minutes.

Another article in ET informs us that:

The monthly pass charges amounting to Rs 2500 was not logical and was on a higher side, said Bombay Youth Association President Pradeep Bhavnani in a letter to the Chief Justice.

The return entry fees was Rs 75 and if a motorist travels every day using this sea link it would amount to Rs 2250 for 30 days in a month. Therefore, charging Rs 2500 for the monthly pass was not logical, Bhavnani pleaded.

Also, as reported by IE:

Initially, the sea link was estimated to cost of Rs 450 crore but has now been completed at the cost of Rs 1,600 crore.

[BJP city unit leader Gopal Shetty] claimed that when Gadkari laid the foundation stone for the sea link in 1999, it was supposed to be completed in three-and-a-half years. However, it has taken over a decade to complete the bridge. Shetty has questioned why Mumbaikars should pay for the additional project cost incurred in the delayed completion of the project. He said that the Congress has already put additional project cost burden on public exchequer and now is going to take toll charges.

If you want to recover the cost with the given toll in one year, then the toll gates will have to process 13.95 cars per second. It is an 8-lane bridge, so let’s say 16 toll booths. That means you need about 0.87 cars to pass through each toll booth in a second to recover the costs in one year.

Having paid toll in various booths around Mumbai, I think the average is closer to one car in 30 seconds, ie, about 26 times slower than the rate we computed in the last para. This brings the cost recovery time to more than 26 years.

Of course, this is an underestimate because cars will come in at a rate smaller than this (during peak hours the rate cannot be more, off-peak the rate will be less), and also because inflation will decrease the actual toll value.

As the BJP has calculated, it is a certainty that the money will not be recovered from the users of the bridge, but will be paid for by other taxpayers. However, even if there were no cost over-runs, it would have taken around 7 years to recover the costs by toll. So even the BJP’s original plans would have put the burden of payment on the general taxpayer.

Note added on July 2. TOI reports that the government has quitely done the same calculation:

The Maharashtra government might have spent Rs 1,634 crore to build the Bandra-Worli Sea link (BWSL), but it could end up giving the BWSL to the contractor that wins the bid for the Worli-Haji Ali Link (WHAL) for just Rs 282 crore.

MSRDC sources said that once the WHAL is completed, the sea link’s toll would rise even higher. To reduce the hefty toll that motorists would have to pay, the state could pay Rs 1,352 crore upfront to the new contractor. However, the new contractor would also have to purchase the BWSL from the state government for Rs 1,634 crore. So, the contractor would end up shelling out just the difference, Rs 282 crore, for the BWSL. The new contractor then collects the toll.

That’s a tax burden of Rs. 1352 crores on the taxpayer.

Note added on July 17:

With half the bridge open, there are only 3 toll booths. When all lanes are opened up there will be 6 toll booths, not 16 as I’d assumed. But the toll to be collected by the private operator has now reduced to only Rs. 282 crores. So it should take only about 12 years for the contractor to recover his share.


Written by Arhopala Bazaloides

June 30, 2009 at 6:48 pm

2 Responses

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  1. Project Cost of Rs.1650 Crores.
    Toll Cost Estimated about Rs.40 to Rs.50 /-
    An estimate of about 125000 Vehicles will be using daily.

    say 50 per trip
    1.25 lac vehicles cross per day
    1.25*50=62.5 lacs
    165000/62.5=2640 days = 7.3 years

    now total tolls 20

    converting seconds per day and multiplying by number of tolls/number of vehicles cross per day.

    60*60*24*20/125000 = 13.824 secs
    so one vehicle has to move from the toll at 13 seconds max to reach that goal. i think its feasible? dont you?


    July 1, 2009 at 8:58 am

    • My calculation differs from yours.

      86,400 seconds a day
      If 125,000 cars cross the bridge every day, that’s 1.44 cars crossing a toll booth every second.

      It’s an eight lane link, so assume 16 booths. Then you need cars to pass a booth in 16/1.44 = 11 seconds.

      Is this reasonable? I think in Mumbai a car usually takes about 30 seconds to pass a toll booth. If you have two cars ahead of you, then you are likely to wait for a minute before you get to the window.

      So let’s use that instead: 1/30 cars/second through a toll booth, 16 booths, a charge of 37.5 Rs/car (as the ET article says) and 86400*365 = 31,536,000 seconds/year. Then you earn
      1/30 * 16 * 37.5 * 31,536,000 Rs/year = 0.63 billion Rs/year. At that rate it will take 26.2 years to recover 16.5 billion Rs.

      Of course, things could be speeded up if everyone buys a monthly pass. Since passes are electronic you could then zip through the gate (which has a sensor). However, the pricing policy is such that you actually pay more for the monthly pass than for 31 daily 2-way tolls. I bet you that means a lot of people will pay the daily 2-way toll

      Arhopala Bazaloides

      July 1, 2009 at 7:46 pm

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