Industry Odisha Bureau, April 25: The 6.5 km stretch strategic Z-Morh Tunnel based in Jammu and Kashmir (J&K) is reportedly going to change hands of ownership very soon for which APCO Infratech is reportedly striking a $267 million deal with Alpha Alternatives.
Inaugurated in 2025 and built at an estimated cost of Rs 2,400 crore, the APCO set- up special purpose vehicle (SPV) in 2020 was reportedly awarded by the National Highways & Infrastructure Development Corp Ltd (NHIDCL), while the project has a reportedly 15-year concession with investments to be recovered through biannual annuity payments of Rs 295 crore, sources informed.
Sources also informed that the pivotal project under the “design-build-finance-operate-transfer (DBFOT) model” reportedly authorises the private entity to “handle the entire project lifecycle before transferring it back to the government”.
“Since the developer does not face traffic risks under the annuity model, the buyer could expect to get assured and fixed cash flow from NHIDCL over a 15-year period”, added sources.
Sources further informed: “As per the sale agreement being finalised, the asset would be valued based on future cash flows guaranteed by the government, while the sale price will essentially represent the current value of the remaining annuity payments, which are fixed, semi-annual instalments paid by the government”.
Notably, “The crucial Z-Morh Tunnel located on the Srinagar-Leh highway (situated at an altitude of over 8,650 feet) not only provides an all-weather connectivity between Srinagar in J&K and Kargil in Ladakh, but also ensures uninterrupted military logistics and civilian access to Ladakh by bypassing an avalanche-prone stretch”.
