Road ministry has moved a proposal, looking for a policy decision to restart about 86 languishing highway projects that have become unviable. It has planned easy "foreclosure" of such assignments so that private developers can storm out of the projects, paying minor "penalty".
The projected scheme will be appropriate for both Public-Private-Partnership (PPP) projects as well as those on government-funding mode or EPC.
Sources held the bureau has moved this proposal after continual references as of National Highways Authority of India (NHAI), looking for its view on the penalty total to conclude such contracts. Bureaucrats alleged since these projects have become monetarily unviable and have been belated by years because of authority's failure to give land in time, the new proposal is to reduce the penalty by one-tenth in "communal interest" so that ventures can be modernized and awarded.
As stated by the present contract norms, developers and freelancers need to pay 1% of the total project cost (TPC) or 20% of their bank assurance amount. But the bureau has at the present planned to bring it downward to 0.1% of the TPC in the case of PPP projects whereas the penalty for terminating administration agreements or EPC will be advanced since in such cases the default is more on the developers' part.
Fascinatingly, the ministry note as well declares that in numerous cases the appointed date to establish work was issued by NHAI "expeditiously" subsequent to both the authority as well as the developers communally decided to waive off certain constitutional requisites. But later the ventures acquired stuck midway for lack of land availability.
"The intention behind this proposal is to get a method out to scrap the agreements of stretches somewhere there is no improvement. Since the projects can be modernized as well as prices can be reworked merely after concluding them, we are looking for this one time approval for the by now stuck ventures. These can be proposal out based on revised price as well as parameters," a road bureau source said.
Discover the latest Business News, Sensex, and Nifty updates. Obtain Personal Finance insights, tax queries, and expert opinions on Moneycontrol or download the Moneycontrol App to stay updated!
