BOC mulls new highway to Katunayake, duty free complex

Sri Lankans travelling abroad would soon have the luxury of avoiding traffic snarls on the Colombo-Katunayake road by popping into an exclusive train straight to the airport – baggage and all – if a mega US$750 million infrastructure project being promoted by the Bank of Ceylon (BOC) gets off the ground.

“We have done a concept paper (for this public/private partnership – PPP project) to revamp and modernise part of the Maradana Railway Station, run an electric train in addition to normal trains and also have an elevated highway on top of the track upto the Katunayake airport,” Gamini Wickremasinghe, Chairman BOC told The Sunday Times FT.

He said that he has spoken to three Malaysian firms and a few in India who are very much interested, but they are concerned about the red tape. “I am proposing that the project be listed on the second board of the Colombo Stock Exchange (CSE). Initially the investor will list only a small amount,” he explained, adding that ‘listing’ has come to the picture in a bid to give the investor an exit point.

He also said that listing will improve corporate governance of the project, give a much needed boost to the capital market and also help elevate BOC’s business.

According to industry analysts such a venture will be welcome by the public at large as the earlier Colombo Katunayake Expressway appears to have been halted at present. Wickremasinghe explained that BOC has been talking to an international consultancy firm on the mechanics of PPPs and how they are done in India. “In India most of the infrastructure development projects are done in the form of PPPs and last year it was said that nearly US $ 262 billion for infrastructure development came from the private sector.”

Wickremasinghe explained that the proposed highway project is a large integrated plan.

“The railway track is 65 feet in width. With an elevated highway it will take 15 minutes to cross the 21 miles to the airport,” he pointed out, adding that it was proposed to have a train every 20 minutes to Katunayake. “In Maradana there is more than a 100 acres. The concept also includes the Maradana Railway compound having a massive duty free compound. We want to link the shopping complex to a bonded warehouse just like the Mohamed Muthapha store in Singapore,” he explained.

Wickremesinghe said part of the Maradana Railway Station will be modeled on the lines of the Victoria Station in UK to manage airport handing. “The highway will be a toll road and the attraction is that this highway will not have any land acquisition or politics,” he added.

Wickremasinghe noted that building an elevated highway is more cost effective than acquiring and constructing a highway.

He pointed out that if the proper approvals are given, this project can be completed within three years. “The only deterrent for all these investors is the massive red tape. There are investors who are willing to invest as much as US$ 5 billion if the red tape is taken off,” he said.

He said only high speed motor vehicles will be allowed to commute on the highway. “The investor needs the maximum out of his investment. Since this is a toll road, he would want as many vehicles as possible so if we allow containers to run for an example the purpose is lost,” he pointed out.

He said with the shopping complex Sri Lanka can get more people especially Indians to visit the country to do more shopping. “This will be purely duty free shopping which will be one of the main attractions,” he said.

Wickremasinghe said that the main emphasis of the project will be to reduce traffic on the main highway and provide the poor an option at low cost, frequent and faster traveling to the airport. “With such a highway, workers at Katunayake can travel from home, as opposed to now, where many are cramped up at boarding lodges. We want to provide convenience to the people and value their time,” he said. “To power these projects we have suggested a power station also to be funded by the investor. Whoever the investor, (the entire project is to be awarded to one investor) will either come up with a new station or strengthen any existing station to power the railway, the highway and even the airport handling terminal at Maradana station,” he explained.

Wickremasinghe said an important aspect that came out of the studies he did of PPPs in India was that all PPPs were chaired by Prime Minister Manmohan Singh. “This was because he could remove any red tape and ensure transparency. Otherwise everyone will pull in different directions.”