The Uttar Pradesh government's plan to build the 1,000-km-long Ganga expressway at an estimated cost of Rs 40,000 crore between Noida and Varanasi has not been received well by the National Highways Authority of India (NHAI).
The authority feels such precedents will lead to a conflict of interest between the Centre and the states.
The NHAI may seek the Centre's intervention to prevent the construction of a parallel access-controlled or tolled highway alongside the Golden Quadrilateral (GQ).
According to NHAI officials, a part of the GQ connecting Delhi and Varanasi and the proposed state highway (between Noida and Varanasi) along side the Golden Quadrilateral would severely affect toll collections leading to losses for bidders since the entire Golden Quadrilateral project is based on the public-private partnership model.
"Such precedents would dampen confidence of investors as toll collections could go down," an NHAI official said.
The state government plans to invite global bids for construction of the proposed expressway and has assured investors that it would "take care" of all administrative aspects.
While announcing the proposed state-highway, UP Chief Minister Mayawati announced that construction of the Ganga expressway would significantly reduce commuting time between remote parts of eastern and the rich western UP, and New Delhi.
Being an access-control or a tolled state-expressway, NHAI fears that the toll revenues at the Golden Quadrilateral will be seriously affected.
"It will be difficult for the NHAI to find bidders for road projects that it takes, as fears of a parallel state highway along side the Golden Quadrilateral could discourage bidders," the NHAI official added.
The proposed Ganga expressway will also include setting up of commercial hubs along its 1000- km-stretch, which is also expected to generate employment through increased business activity.