The corporation is being set up on the basis of estimates that such amenities will generate substantial revenues for the state. The state corporation is currently in talks with a leading German truck and bus stop organisation to set up terminals in three leading cities in the state. The terminals that are proposed to be set up will be equipped with numerous facilities for travellers and will require an investment of about $8 million each. The foreign partner is expected to bring in at least half that amount. "We will set up more such terminals across the state based on the success of the first lot," said a source in the state government.

The bus stops and terminals will be run on a build-own-operate (BOO) basis. The land required for theproject will be provided by the state government -- represented by the corporation -- and a part of the revenue generated which is to be shared with the state, will be provided in the form of an equity stake in the venture.

Revenue in such projects will come from the toll collected from owners of trucks and buses, lease rentals from commercial centres in the terminals, advertisements and various other services provided, like telephone and refuelling services.

The government has already included mass rapid transit system (MRTS), light rail transit system (LRTS), expressways, intra-urban roads like urban passes and flyovers, bus and truck terminals, subways and other amenities for the road sector in its definition of infrastructure as part of its efforts to push reforms forward in the sector. Accordingly, all investments in these areas will enjoy tax benefits under Sec 80-1 (A). The tax exemptions following the notification include a 100 per cent tax exemption for the first five years of the project and 30per cent in the subsequent five years. Further, the long term capital gains tax, tax on lenders and the opeators' income tax will also be exempt from tax. Foreign and domestic investors who have lined up mega plans to invest in road projects in the country have sought appraisals from credit rating agencies on the ability of the various states to meet their guarantees.