Nellore Bypass

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In April 2002, the National Highways Authority of India (NHAI) awarded a 17 year concession contract to NYSE Infrastructure Private Limited (NYSE) to develop the Nellore Bypass Project in the southern state of Andhra Pradesh. The project included four-laning of the 17 km stretch on National Highway five (NH-5) that passed through Nellore, construction of two three-lane bridges over Pennar river, a six-lane railway over bridge, five minor six-lane bridges, five access controlled underpasses and 67 culverts. The concession term included a construction period of two years. The Nellore bypass project was part of the Chennai-Kolkata section of the NHAI’s Golden Quadrilateral Program that linked the four major Indian cities of New Delhi, Mumbai, Chennai and Kolkata. This project was expected to ease traffic congestion in Nellore town and over Pennar Bridge and ultimately facilitate the trade route between the Eastern Corridor and South India. NYSE Infrastructure Private Limited was a joint venture between India’s Navayuga Group (51%) and Soma Enterprise Limited (49%). NYSE won the project through an international competitive tender conducted by NHAI. Under the contract, NYSE was compensated for the capital and operating costs including returns by way of a fixed semi-annual payment (annuity) of US$ 2.81 million from the NHAI during the operation period of 15 years. Under the annuity scheme, the private operator cannot collect tolls from the users of the facility. The total cost of the project was estimated at US$ 34 million. The project reached financial closure in October 2002, with a debt equity ratio of 2.56:1. Construction began in October 2002 and the road became fully operational in September 2004.