New impetus to revive economy: An expressway covering entire country

24 September 2019 09:12 am - 0     - {{hitsCtrl.values.hits}}

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  • A new elliptical expressway parallel to coast at a distance of about 40-50 km from coast, around Sri Lanka. 
  • New expressway to provide easy access, both to coastal belt and hinterland
  • A single expressway from Medawachchiya to Kilinochchi
  • Fast-tracked construction to be completed in five years
  • Project investment likely to be a massive boost to entire economy
  • Project investment to be generated from funds saved as a result of reduced rates of interest due to sound management of economy
  • Economy to reap a host of other short and long-term benefits as well
  • People have a responsibility to elect leaders who are capable of implementing projects and positively dealing with emerging challenges

 

Sri Lanka is a country in the shape of an ellipse. While the central part is mountainous, the rest of the island is a flat plain. The distance from the North to South is about 420 km and from East to West, it is about 220 km at the maximum point. 


Based on these geographic factors, if an expressway is to be constructed in the most practical and cost-effective manner to cover the entire country, it is logical that it must be in an elliptical shape, parallel to the coast at a distance of 40-50 km from the coast.


It is possible that the Northern point of such New Elliptical Expressway (NEE) could be close to Medawachchiya, the Southern point close to Kirama, the Eastern point close to Pokurugama and the Western point close to Mirigama. As the feeder to the NEE, many of the existing roads can be easily connected to it as ‘entry’ and ‘exit’ points.


Already, there are highways from Kadawatha to Godagama (144 km) and Colombo to Katunayake (25 km). In a few months, a connecting highway will be seamlessly linked from Kadawatha to Kerawalapitiya (10 km) and another from Godagama to 
Hambantota (75 km). 


Once those sections are completed, the expressway system of Sri Lanka will be completed from Katunayake to Hambantota, in close proximity to the coast. At the same time, since a considerable length of highway spanning the districts of Gampaha, Colombo, Kalutara, Matara and Hambantota has already been completed, it may now therefore be more practical and sensible to connect such existing highway to the NEE, without constructing the section of the proposed NEE parallel to the coast from a distance of 40-50 km in those districts.Therefore, Kudaoya may be considered the possible starting point of the NEE connecting to the present highway from the South, while Mirigama may be the chosen Northern starting point. When that is done (as shown in the map attached), the NEE will run 40-50 km parallel to the coast covering a distance of around 500 Km through the hinterland, avoiding the forest and wildlife regions, historical and archaeological sites, densely populated areas and special places of attraction to local and foreign tourists. 


The land area to the North of Medawachchiya is of a triangular shape and therefore, the construction of an elliptical expressway beyond Medawachchiya will not yield a cost-effective advantage. 


Accordingly, a single direct expressway of about 105 km at the centre of that area providing access to both sides of the triangle can be built from Medawachchiya to Kilinochchi and connected to the NEE, so that it becomes an integral part of the NEE. Once this Medawachchiya/Kilinochchi section too is constructed, the entire country will be fully connected through a 100 kmph expressway system, comprising a total of about 859 km.

 


Maximum travel time about 5 hours
If a ‘connected’ expressway is constructed as described above, any person from any part of Sri Lanka will be able to gain access to the NEE easily after travelling a distance of a maximum of 50 km from any part of the country, coastal or hinterland. For example, if a person wishes to travel from Siyambalanduwa to Mannar, he will travel a distance of about 30-40 km on ordinary roads, enter the highway at a suitable entry point, cruise along the highway, exit from Vavuniya, travel a further distance of about 30 km on ordinary roads and reach Mannar. 
Similarly, a person travelling from Balangoda to Trincomalee can first take an ordinary road covering about 40 km, enter the highway from an entry point near Kuda Oya, cruise along the highway, exit from an exit point near Demataweva and reach Trincomalee after finally travelling a distance of about 40 km along ordinary roads. 


In this manner, a person will be able to travel any long distance easily from any point in the country, where maximum time spent on travelling from any point to point, not being more than five hours.

 


Investment required for this project?
The Southern Expressway from Kottawa to Godagama is 124 km. Its cost (incurred during 2007 to 2013) is reported to be US $ 892 million. That is, US $ 7.2 million per km. Therefore, we may reasonably assume it will be possible to construct the proposed NEE at a cost of around US $ 7.2 million per km, since the terrain through which the proposed expressway is to be constructed is somewhat similar to that of the Kottawa/Godagama expressway.


The length of the proposed elliptical part of the expressway, as shown in the map, is about 500 km, while the section from Medawachchiya to Kilinochchi is about 105 km. Accordingly, the total length of the proposed NEE works out to approximately 605 km. Hence, the total cost of the project may be estimated at around US $ 4,350 million. 


In order to implement such a project, it will also be necessary to undertake a scientific and geographical survey of the land layout and contours and decide on the proposed path of the highway. Such an exercise is likely to take at least one year and the expenditure covering the technical and architectural consultancies and other evaluations may amount to around 
US $ 200 million. 


Further, if the project is to be fast-tracked to be completed in five years from 2021-2025, a sum of around US $ 870 million per annum (or Rs.157 billion) will have to be invested by the government on physical earth works, infrastructure construction work, etc. 


Although such annual outlay may appear to be a considerable investment, it will not be such a daunting task for the government to raise the total requirement of funds from existing sources, if the public debt is managed in a sound manner.


Sri Lanka’s gross domestic product exceeds Rs.14,000 billion and the public debt exceeds Rs.13,000 billion. The existing stock of treasury bills and bonds amounts to Rs.5,500 billion. Hence, if the authorities are able to successfully reduce the treasury bill and bond interest rates to a level close to the level that existed at end-2014, the rates will be tightened by about 3 percent p.a., which alone will save a sum of around Rs.165 billion per year for the government. Incidentally, such saving will be more than the annual requirement of Rs.157 billion for this NEE project.


It may be recalled that the previous government was able to save such large amounts of money through the proper management of the Sri Lankan economy, during the term of President Mahinda Rajapaksa and these surpluses were utilised for various development projects. 


Further, the shift of funds to investment will lead to a massive economic revival that will be visible and tangible across the economy, with new economic activities being spurred on by such investments.

 


Investment on NEE will infuse new life to economy that is now in shambles
Once the NEE is completed, there is no doubt that many areas of the country that are today identified as ‘difficult areas’, will undergo rapid development, since the entire country will become interconnected.


Businessmen and entrepreneurs will locate their business establishments and factories throughout the country. Investors in the tourism sector will take a renewed interest in constructing hotel complexes and tourist infrastructure facilities in all 
parts of the country. 


International investors will find Sri Lanka a hugely attractive location. The consequent economic progress will cover every village, while the present beleaguered building contractors of high, medium and small-scale constructions will enjoy a new lease of life. The beneficial impact of such a revival will soon trickle down to other sectors as well. Thus, the proposed expressway project will be a tremendous boost to the economy of the country.

 


People too have a responsibility
At present, Sri Lanka is trapped in a serious economic downward spiral. The economy is paralysed and has no direction. The current leaders have not introduced any worthwhile strategy in a manner that generates any business confidence. Even on the rare occasions where various projects have been suggested, those have failed miserably, since there has been no strategy to raise the funds necessary to implement such projects. 


From 2006 to 2014, Sri Lanka’s economic managers secured the required resources for the massive development projects launched and implemented during the term of President Mahinda Rajapaksa. Money circulated freely and confidently within the country. There was never a shortage of funds for the war, reforms, rehabilitation, resettlement, development, relief measures and repayment of debt. That government faced the plethora of challenges that confronted it through systematic planning and strategic implementation of such plans. As a result, unprecedented improvement took place in infrastructure; interest rates and inflation were at manageable levels; the Sri Lankan rupee was stable as never before (or after) in history. Overall, all macroeconomic fundamentals were on a sound footing.


For a country to progress, it is necessary that there should be far reaching proposals that are realistic, useful and beneficial to the people of the country. If that happens, the entire country will become a dynamic worksite. 


This proposal for the NEE is one such proposal. At the same time, there is no doubt that there will be many challenges when this proposal is being implemented. Many crucial decisions will have to be taken. At that time, lamentations and excuses, similar to those that the leaders of the current government make before the people on a daily basis, 
will be of no use. 


Therefore, it is the bounden duty of the people to entrust the governance of the country to leaders who have a proven record of facing challenges and who are knowledgeable and experienced. That responsibility will need to be taken seriously by the entire population. 
(Ajith Nivard Cabraal is an ex-Governor of the Central Bank of Sri Lanka)

 

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