Nagpur: Maharashtra govt has approved a Rs3 ,162.18 crore govt guarantee for a loan to be raised by Maharashtra State Road Development Corporation (MSRDC) from HUDCO for land acquisition of the proposed Rs21 ,670 crore Nagpur-Gondia Access-Controlled Expressway.The Finance Department issued the govt resolution on July 21, approving the guarantee for a loan comprising Rs 2,006.03 crore principal amount and a potential interest component of Rs1 ,156.16 crore.The proposal was approved by Cabinet Infrastructure Committee in its meeting held on April 22, 2026.The Nagpur-Gondia Access-Controlled Expressway will have a total length of 162.377 km and will connect Gavsi Manapur in Nagpur district to Sawari in Gondia district. The six-lane expressway, with three lanes on each carriageway, will pass through and improve connectivity between Nagpur, Bhandara and Gondia districts.The project will require acquisition of around 1,634.27 hectares of land and will have nine interchanges to facilitate access at different locations along the corridor.The govt guarantee will remain valid for 12 months and will be restricted to Rs3 ,162.18 crore. The tenure of the loan has been fixed at 15 years.According to the govt resolution, MSRDC will remain the principal debtor and will be solely responsible for repayment of the loan. The state govt has clarified that the liability arising from the loan will not be transferred to the state exchequer.The guarantee will not cover penal interest or other charges arising due to delay in repayment by MSRDC. HUDCO will have to inform the govt within 90 days in case of any default in repayment of the loan.The govt has also imposed restrictions on the borrowing arrangement. HUDCO will not be allowed to provide any loan beyond the approved limit without prior permission of the state govt, while MSRDC will not be permitted to raise loans from any other financial institution for the same purpose.An independent escrow account will be opened in the name of MSRDC for managing the loan amount, project-related revenue and repayment to HUDCO. The corporation has been directed to use the funds only for the purpose for which the loan has been sanctioned.In case of default by MSRDC, HUDCO will first have to initiate recovery proceedings by selling or auctioning the corporation’s mortgaged movable and immovable assets. The govt guarantee can be invoked only after all recovery efforts have been exhausted.
