Developing World-Class Infrastructure at Amaravati
PPP - for Roads Sector
PROPRIETARY
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Introduction to Amaravati1
Technical overview of the asset class2
Transaction structure options3
Key points for discussion4
Contact us5
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Amaravati - the People’s Capital of Andhra Pradesh
ndia’s largest greenfield venture
Amaravati, the people’s capital of Andhra Pradesh is envisioned to be the pioneer smart city of India at par with world class standards with cutting-edge infrastructure and immense prosperity in an environmentally sustainable manner
- Sri Chandrababu Naidu N (Hon’ble Chief Minister of AP)
Planned investmentover 20 years
$6 bnAnchor sectors identified for Amaravati
9
Area of the capital city
217 km2
Farmers participated in largest ever consensual Land Pooling initiative
24000
29Villages which constitute Amaravati
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Amaravati is strategically located close to key economic hubs.
APCRDA
Capital of Tamil Nadustate (Manufacturing,
Auto and electronics, ITexports)
Largest cities in the CR (Majorfood production, textile,manufacturing,
education hub)
Common capital for Telangana & AP (IT/ITeS hub, pharma, Bio-tech/Aerospace)
Capital of Karnataka State (IT/ITeS/Aerospace/Defense Hub/Electronics)
▪ Strategically located to key
economy generating mega
cities i.e., Vizag,
Hyderabad, Chennai &
Bangalore
▪ Centrally located within
Andhra Pradesh
▪ Multi-modal connectivity
through Road, Rail, Port &
Airport
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Amaravati has a connectivity advantage – key for its growth
aspirations
Bounded by two National
Highways - NH5 connecting to
Vizag and Chennai; NH9 connecting
to Hyderabad and Machilipatnam
~20 min from Vijayawada
junction – 2nd busiest railway
junction in the country
~250 kms from Kakinada port1; New
port to be developed within 100kms
(Vadarevu or Machilipatnam)
Also, a major Inland waterway
hub
~25 kms from existing Gannavaram
airport;
Roads
Railway
Port
Airport
1 Deep water port with quay length of 2,500m for multi-product handling
Railway double line
Railway single line
Forests
National highway
State highway
Airport
Port
River
Capital city boundary
Capital region boundary
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Amaravati will be the first city in the world purpose built with
urban design derived from “Happy City” principles
SOURCE: “Stress That Doesn’t Pay: The Commuting Paradox,” Scandinavian Journal of Economics, 2008: 339– 66
Montgomery, Charles (2013-11-12). Happy City: Transforming Our Lives Through Urban Design
Studies show that
when all daily needs
are within a
5-minute walk
of home, a sense of
community thrives
Designing urban
spaces geared towards
social interaction leads
to better citizen
satisfaction (greater
impact on national
satisfaction than giving
a 50% pay rise)
A person with a one-
hour commute has to
earn 40% more
money to be as
satisfied with life as
someone who walks to
the office
People who walk ten-
minutes to work weigh
on average 5kgless than those that
don’t
Need better photo
With Karsten
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Amaravati’s dimensions of happiness
World-class
infrastructure
Quality living
for all
Green clean,
resource efficient
Responsiveness
and sustainability
Old & new
Economic power house
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Amaravati will have world-class infrastructure across all
elements in line with vision
50%+ public transport
use, 80%+ coverage
of bus stops in
walking distance,
accident-free
7 sq.m. per student
with walk-to-school
concept, 40 beds
per 10K population
and 5 minutes to
emergency facilities
24x7 stable power with
underground cabling
100% penetration,
20%+ renewable, <5%
transmission losses
Congestion-free
roads with
2.5km/Kcapita with
bicycling and
pedestrian paths
20%+ open spaces
with distinct
developments (e.g.
public spaces,
riverfront)
within walking
distance from 95%
residences
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Nine economic anchor sectors have been identified as drivers
of growth for Amaravati
SOURCE: WIOD, IHS, MGI, expert inputs, Press Information Bureau, GOI
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Total # Jobs (Direct, Indirect, Induced)
GDP estimation
Population & GDP for Amaravati are expected to grow at an
accelerated rate
xx GDP per job
(INR lacs)
Year 25
0.4-0.7
11-13
Year 15Year 10Year 3
6-8
Year 20
3-5.5
9-11
INR ‘000 crores at current prices
Lakh jobs
Year 25
+9% p.a.80-120
15-30 35-50
Year 10 Year 15
60-85
Year 3
2.5-4
Year 20
5-6 5.5-6.5 6-7 7-8 8-9
SOURCE: Amaravati Socio-Economic Masterplan
Year 35Year 10
5-6
30-35
Population estimation
Lakh population
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Nine sources of funding are being pursued to meet the need
of funds for Amaravati’s set-up and operations
SOURCE:Amaravati Socio-Economic Masterplan
Land
monetizationOther sources –
bonds etc.
Investor
Classes
NIIF
1
2
34 5 6
7
8
9
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Introduction to Amaravati1
Technical overview of the asset class2
Transaction structure options3
Key points for discussion4
Contact us5
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Classification of Roads in Amaravati
S. No. Type Nos. RoW (m) Length (km)
1 Major Arterial Roads 3 60 44
2 Arterial Roads 17 50 107
3 Sub Arterial Roads 14 50 145
4 Collector Roads - 25 277
5 Internal Roads - 15.6/ 17 1100
SOURCE:Amaravati Infrastructure Masterplan
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Proposed Cross Section – Arterial Road (50m ROW)
SOURCE:Amaravati Infrastructure Masterplan
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Proposed Cross Section – Sub-Arterial Road (50m ROW)
SOURCE:Amaravati Infrastructure Masterplan
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Proposed Cross Section – Collector Roads (25m ROW)
SOURCE:Amaravati Infrastructure Masterplan
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S. No.
Classification of Roads
(As per
Development
Plan Report)
Design Speed (km/hr)
IRC
Design Speed (km/hr)
DMRB
Design Speed (km/hr)
AASHTO
Design Speed (km/hr)
Singapore
Design Speed (km/hr)
Recommended
For Amaravati
1Major Arterial Road
80
50 - 80
50-100 60-70 80
2Arterial/Sub Arterial road
80 50-100 60-70 80
3 Collector road 50 50 NA 50
4 Local roads 30 30-50 40-50 30
International Design Standards and Performance
Design Speed
SOURCE:Amaravati Infrastructure Masterplan
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Description
AASHTO
New York
AUST
ROADS
Sydney
DMRB
London
European
Amsterdam
LTA
Singapore Abhudabi IRC Adopted
Lane width (Carriageway) (m)
2.7 - 3.6 3.0 - 3.5 3.0 - 3.65 3.0 - 3.5 3.4 - 3.7 3.3 - 3.7 3.0 - 3.5 3.5
Cycle track (m)
1.5 1.5 1.5 - 2.0 1.5 - 2.0 1.5 - 2.0 1.5 - 2.0 2.0 2.0/3.0
Footpath (m) 1.2 1.2 1.5 1.5 1.5 1.8 1.5 3.0 – 3.5
Super elevation (%)
6 6 5 5 6 5 5 5
Camber or Cross Fall (%)
1:50/
1:401:50/ 1:40
1:50/ 1:40
1:50/
1:40
1:30/
1:40
1:50/
1:401:50/ 1:40
1:40
Min/Max Longitudinal gradient (%)
0.2/6 0.3/6 0.5/6 0.3/6 0.4/6 0.3/4 0.3/3.3 0.3/3.3
International Design Standards and Performance
SOURCE:Amaravati Infrastructure Masterplan
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HS
Chainage
(Km)CBR MSA VG
Pavement Crust Composition (mm)
BC DBM WMM GSB TotalFrom To
I 0.000 21.350 10% 100 VG - 40 50 110 250 200 610
Proposed Pavement Crust Composition
SOURCE:Amaravati Infrastructure Masterplan
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8 Priority Roads with approximate length 85 kms have been
identified in current year to provide connectivity within
Amaravati
SOURCE: APCRDA
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Introduction to Amaravati1
Technical overview of the asset class2
Transaction structure options3
Key points for discussion4
Contact us5
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7 roads with total length of 65 Kms has been proposed for
HAM in current year with an approximate cost of 2000 Cr
S.No Road No. Type
Length
(Km.)
Typical
Cross
Section No. of Structures
Estimated Cost
(INR Cr)
1 E08 Sub Arterial 13.67
6 lane + 2
lane BRT
3 Bridges & 28
Culverts 451.11
2 E10 Sub Arterial 7.70
4 lane + 2
lane BRT 1 Bridge & 16 Culverts 231
3 E13 Sub Arterial 7.33
4 lane + 2
lane BRT 18 Culverts 219.9
4 N4 Sub Arterial 7.12
4 lane + 2
lane BRT
2 bridges & 14
Culverts 213.6
5 N9 Sub Arterial 12.00
6 lane + 2
lane BRT 1 bridge & 20 Culverts 396
6 N14 Sub Arterial 8.26
4 lane + 2
lane BRT
2 bridges & 16
Culverts 247.8
7 N16 Sub Arterial 8.60
4 lane + 2
lane BRT 1 bridge & 14 Culverts 258
SOURCE: APCRDA
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Smart Solutions along Roads Infrastructure can speed
recovery of capex
# Smart Element Description
Smart
Bus Stops
Bus stops with wi-fi, real time digital display of schedule, power chargers,
solar panels, digital advertisement panels
Other smart solutions include Advanced Traffic Management System, Emergency Box, Public
Address Systems, Smart City Operations Center, City Wi-Fi, Smart Metering, E-Challan
Smart Street
Lighting
LED Lights that adapt to movement by pedestrians, cyclists & cars.
Automatic dimming & Brightening. Also, they can be monitored & controlled
wirelessly.
Utility Corridor
Utility lanes to carry all utilities like Power distribution lines, water,
sewerage, ICT lines, storm water, gas, fire hydrant, etc.
Environmental
Sensors
Smart Environmental Sensors should be able to read and report the
following parameters: Temperature, Humidity, Radiation and Air Quality
Variable
Messaging
Display
Display the useful information related to Traffic congestion, Accidents,
Ongoing Roadwork zones, Speed limits , Key notices or information about
any emergency or disaster, Display the parking availability information, etc.
RLVD
Red light violation detection(RLVD) system automatically detects violation
& can issue e-challan.
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Infrastructure development at Amaravati presents unique
opportunities & challenges
Greenfield city
Mandate as per APCRDA Act
Parallel construction of infrastructure
High Financing Need
Opportunities to develop & operate latest smart
infrastructure – no inherited infrastructure assets
Infrastructure provision to be in line with the
APCRDA Act 2014
Need to ensure linkages of infrastructure
development across roads & utility corridoor
High financing need for new world-class
infrastructure
Significant future opportunities in
RoadsMore than 150 Kms of Arterial & Subarterial roads
to be built in next 3 years
World Class InfrastructureHighest standards of infrastructure principles ;
Travel time < 15 m, Energy efficient street lighting
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Guiding Principles for design of the PPP structures
Demand Risk
Allocation▪ Public sector to manage demand risk, since it is linked to city
growth & population projections
Capex
Investment
Viability
▪ Ensure capex is in line with investor ability to invest
▪ Grouping of roads to provide suitable investment package
Infrastructure
roll-out plan
▪ Ensure infrastructure roll-out is as per master plan to meet
statutory and other commitments
▪ Incentivize accelerated roll out of infrastructure development
Smart
infrastructure
elements
▪ In line with city’s development plan & overall smart city vision,
combine smart elements as a part of the package
Financing
Considerations
▪ High investment of roads proposes high capex risk which needs
to be shared
▪ O&M financing to be adjusted to change in scope & interest rates
Clarity in scope &
responsibilities
▪ Ensure clarity to minimize subjective interpretation of scope &
responsibilities
▪ Set up mechanism for dispute resolution
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NHDP PPP projects awarded in roads sector
1 BOT (Toll) data till 29 Feb 2016
813
28
40
600
7
FY15
53
0
FY161
32
4
FY14
001
FY13
2
1
1510
SOURCE: IBEF report, PPPIndia database; web search, Ace Equity; India Infrastructure Monitor
Mode of award for road projects
No. of projects
▪ 6 HAM projects
awarded in FY2016
▪ Examples
– 4 laning of Gagalgeri
- Saharanpur -
Yamunanagar ( UP/
Haryana Border)
– 4 laning of
Chultmalpur -
Ganeshpur and
Roorkee -
Chutmalpur-
Gagalheri
EPC BOT-AnnuityBOT-Toll HAM
Strong Push on HAM model going forward in PPP contracts
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Hybrid Annuity Model is a combination of EPC and Annuity
model designed to minimize traffic risk
SOURCE: Expert interviews, NHAI website
HAM
Contract
Structure
Risks
Risk category
Public
Sector Concessionaire Notes
Traffic/Revenue ▪ Traffic volume, tariff rates, tariff leakage
Financing ▪ Financial closure on time
▪ Financing cost overrun
Construction ▪ Cost Overrun, Time Overrun, Quality risk
Operations & Maintenance ▪ Capex escalations to be split according
to responsibility for delay
Payment delays ▪ Risk to be mitigated by roads fund or
letter of credit from bank
Input Material Cost ▪ Material cost fluctuation risk
Change in Project Scope ▪ Changes due to other utility work should
be adjusted for
Pre-Construction Clearance ▪ Environment, ROW, Forest clearances
Economic ▪ Tax rate risk, Inflation risk
▪ Combination of EPC and BOT model; Bidders to specify total project and O&M costs as bid
variable
▪ Awarding agency to provide 40% of the Bid Project Cost in 5 equal installments during
construction period
▪ Remaining 60% to be provided in 30 biannual installments
▪ Payments adjusted with price indexes (WPI,CPI) and prevalent RBI interest rate
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Introduction to Amaravati1
Technical overview of the asset class2
Transaction structure options3
Key Points for discussion4
Contact us5
| 28
Key Points for discussion: Perspectives on the transaction
structure
Smart Elements & other Bundling
Risk SharingTechnical specs, layout, & phasing
Comments on HAM Model
Key Concession Terms Operating & other support