On the face of it, it is everyday housekeeping by the government, which has been indulging in this activity for the past 10 years at the helm, as the Cabinet Committee on Economic Affairs, headed by Prime Minister Narendra Modi, approved two road projects on Wednesday, valued at Rs 14,114.81 crore. Yet, examine the two approvals side by side and the combined picture is more intriguing than either would be alone: one, that of a capital city attempting to breathe life through a forest it cannot bulldoze and the other, of a drought-stricken hinterland which has waited generations for a road that does something useful.

In monetary terms, the costlier of the two is the Delhi Dwarka Expressway tunnel, which costs Rs 6,969.67 crore. It is a six-lane, 8.1-kilometre-long corridor on NH-148AE which will be linking the Shivmurti NH-148AE inter change on Dwarka Expressway with Nelson Mandela Marg, Vasant Kunj. Approximately 3.1 kilometres of this alignment will be underground and pass under Southern Ridge Forest, as opposed to crossing it. That's more than just an off-the-cuff reference in a press briefing. Delhi's ridge forest is one of the remaining big green lungs within the National Capital Territory and any road across it would have led to years of legal battles, environmental protests and activists opposing it, like the case with other road projects across the country. The government has agreed to a longer time limit for clearance and more expensive construction in going under cover; a compromise that planners of new roads in crowded, space-challenged megacities from Seoul to Mumbai have increasingly been forced into, as the surface land for new roads dwindles.

Its construction will follow the Hybrid Annuity Model where 40 per cent of the investment will be made by the government and the balance through annuity payments over the operating life of the tunnel. This financing decision is significant in itself. As a result, along with the shift to public-private partnerships for projects that private developers are hesitant to take on due to pure toll risk, from an unclear traffic forecast or the political difficulties of collecting tolls on an urban commuter road, HAM has emerged as the preferred structure. The construction is expected to take place over five years and the government hopes that once it is finished, it will alleviate congestion for passengers travelling between West Delhi, South Delhi, Gurugram and the airport, and will eventually reduce congestion for passengers moving towards East Delhi, Ghaziabad and Noida as well. But almost 7.54 lakh person-days of direct employment and 9.80 lakh person-days indirectly are also to be expected during the construction phase; although it is good on paper, it is best viewed as a ceiling figure for the project, as employment in other infrastructure projects has a proven track record of undershooting Cabinet projections.

The smaller one, the Kanpur-Kabrai corridor in Uttar Pradesh, costs Rs 7,145.14 crore, but is perhaps bigger in impact. It is a four/six-lane access-controlled greenfield highway, which is part of the Bhopal-Kanpur Economic Corridor, connecting Kanpur, Hamirpur and Mahoba districts. Facing decades of underdevelopment in the Bundelkhand region, better known for its drought cycles, agrarian distress and outmigration, Mahoba has been officially declared an ‘aspirational district’, a bureaucratic term for the region. NHAI will do this under the Build-Operate-Transfer (BOT) toll policy where private concessionaires will build and run the road and recoup their investment from the toll at the road, and not from the exchequer. It is a meaningfully different risk allocation from the Delhi tunnel and it is more or less the pattern by which Indian road financing has developed over the years: toll-based BOT is used where traffic volumes are known and expected to grow, HAM is used where there is political or revenue uncertainty, and therefore toll risk alone is not attractive to bidders.

The figures of Kanpur-Kabrai are really staggering. After completion, the journey time through it will be reduced from approximately three and a half hours to ninety minutes (80-100 kph), a reduction of almost 58 per cent. By the time the government reaches financial year 2028, it expects AADT of around 18,069 passenger car units annually, but several transport planners who are familiar with Bundelkhand's freight traffic find this already a conservative estimate as logistics traffic has been increasing at a rapid pace along similar corridors in central India over the last five years. Construction work is slated to be completed within two and a half years, much shorter than the five-year runway for the Delhi tunnel, partly because the greenfield rural alignments are not as strenuous on utilities shifting, and land congestion and forest clearance, which are central issues in urban tunnelling projects. The number of person days of direct and indirect jobs it estimates here is around 1.2 crore, which is substantial, though short term, income infusion in one of the most under-employed rural belts in India, if it turns out to be anywhere close to the projection.

Both projects are part of the PM GatiShakti National Master Plan, with officials packaging them as access to four economic nodes and ten logistics nodes. That framing isn't just rhetorical product packaging. The cost of logistics in India has always been high compared to most other economies and successive ministries of road have always focused on highways as the one most direct means to reduce the same. This has to be put in perspective: NHAI had built 5,313 kilometres of NHs in the last financial year, surpassing its target by about 15 per cent, while its capital expenditure had surpassed Rs 2.44 trillion. This is a rate of construction that has been sustained over several years; it is almost unique among large economies anywhere outside China, which has been the only other nation in the world to grow its expressways at a similar pace over the last 20 years, but in a very different manner of state financing that has involved much less private toll financing.

The uniqueness of the current moment, however, is not only in the amount of construction but how the government is now paying for the amount of construction. NHAI has been monetising completed toll asset steadily via Infrastructure Investment Trusts and Toll-Operate-Transfer schemes in the past financial year, raising Rs 28,307 crore and setting a new target of Rs 30,000 crore. The NHAI's new flagship InvIT vehicle, the National Highways Infra Trust, now trades at a market capitalisation of over Rs 35,900 crore and a P/E of more than 47, reflecting the investor appetite for predictable and government-backed toll cash flows amidst a wider capital-intensive and slow-cash-flow infrastructure financing market. A separate InvIT, Raajmarg, recently offered the public 1,500 kilometres of new road for acquisition by raising Rs 6,000 crore. In a separate development, Union minister Nitin Gadkari has also envisioned that toll collections across the country could reach Rs 3.5-4 trillion per year by implementing barrier-free, satellite and AI-enabled toll collection systems to replace the existing fee plaza based toll collection model. Combined with the figures, the development implies the Government's drive to build roads is no longer just about public spending it's becoming a securitisation story as finished roads are sold into investor-owned trusts, enabling the capital to be directed into the next batch of road construction, such as these two this week.

Embedded beneath all this is a less comfortable thread, one that involves land. NHAI has been embroiled in a protracted legal battle to pay fair compensation to farmers whose land was acquired for the then highway project and the Supreme Court has recently ruled that the constitutional guarantees of the payment of fair compensation cannot be watered down by the fact that the financial burden on NHAI is heavy. But as happened in that case, each kilometre of the Kanpur-Kabrai stretch will need a new land acquisition in Bundelkhand farmland and it is often the rate of acquisition that makes the difference between a two-and-a-half-year time frame and reality. In Delhi, the tunnel avoids much of that friction by burrowing beneath forest land as opposed to private plots, which is what it was designed to do in the first place, and why it's the more expensive option.

Wide open highways where land is flat and uncontroversial, are mostly done. What remains must be tunneled under protected forests, funded not just as budgetary allocation but also via investor trusts, and carved out of some of the country's most land-fragmented and economically fragile districts. The buzzed-about number of Rs 14,115 crore is the least interesting aspect of the story. It is the financing structure behind the project, and whether farmers in Bundelkhand receive a fair deal in for their land prior to the arrival of the bulldozers, that will be the true test of this project.

The chart indicating the ₹14,115 crore apportioned for the two projects based on financing model and an image of the Dwarka Expressway tunnel in construction phase, which is also related to the piece, is in the upper section as well, which you can use with the piece if it fits your layout, or drop for a pure-text run.