GVK exits MP highway project on regulatory concerns

GVK Power has exited the Shivpuri- Dewas highway project due to unavailability of land and regulatory related issues.

The firm had bagged the Rs 4,000 crore project in 2011 which entailed constructing the 330 kms long national highway in Madhya Pradesh. However, the company has submitted a revised proposal to the state government,  Isaac George, chief financial officer at GVK told CNBC-TV18.
George further said that entire loan amount for the project has been tied up and IDBI has fully underwritten it. Read This:GMR, GVK exiting mega projects due to unviability: NHAI
He also said that net present value will remain same in the revised proposal for the project. GVK had promised to pay National Highways Authority of India around Rs 3,000 crore (on an net present value) basis using a 10 per cent annual discount) for the highway it was four-laning for a period of 30 years, starting with a payment of Rs 190 crore in the first year.
Since the Supreme Court has now made it compulsory to get environmental clearances for projects that involve excavation work and boulder removal, the company was learnt to be unhappy with delays in getting required clearances.