The shortlisted firms are New Delhi-based Oriental Structure Engineers, Mumbai-based Reliance Infrastructure Limited, and a consortium of IL & FS Transportation Network, IL & FS Engineering & Construction and Suryavir Infrastructure Construction based in Mumbai.

In its Expression of Interest (EoI) call on September 20, the government has assured a minimum revenue guarantee and its 20 percent stake in the project.

Under the RFP, the shortlisted companies have to submit a detailed proposal of how they would develop the project. “As all three firms fulfilled the minimum criteria, we selected all of them,” said Tulasi Prasad Sitaula, secretary at the Ministry of Physical Infrastructure and Transport.

The government had sweetened the deal as previous bidders abandoned the project seeing scant chances of being able to make much money from it.

Guaranteeing a minimum traffic, the government has put forward a condition that if vehicular movement is greater than the fixed level, the developer will have to share the income on a 50:50 basis. In case traffic is less than expected, the developer will be compensated based on the toll fee determined in consensus with the government.

In previous EoI calls, the government had asked prospective developers what its stake in the project should be, but this time the government has stated what its stake will be. The project involves survey, design, engineering, financing, procurement, construction, operation, maintenance and transfer of the approximately 76-km-long Kathmandu-Nijgadh expressway and a 18-km long additional two-lane expressway on the existing two-lane road (making a four-lane expressway) of the Nijgadh to Pathlaiya section of the East West Highway.

According to the ministry, the developer cannot charge toll fee for the expansion of the Nijgadh-Pathalaiya section of the road.

A preliminary feasibility study has estimated the project cost, including 20 percent financing cost, at $844 million. The applicants have been asked to make field visits to make their own cost estimates.

According to the ministry, land acquisition job is 90 percent complete, and 80 percent of track opening work has been over.