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Agreements with road contractors may be relaxed

Last Updated: Tuesday, August 25, 2009 - 19:33

New Delhi: A high level committee,
constituted by Prime Minister Manmohan Singh on road projects,
is believed to have recommended relaxing the controversial
concessionaire`s agreement to make the projects attractive for

The committee headed by Planning Commission Member B K
Chaturvedi would be submitting its report to the Prime
Minister by Thursday.

Sources said the committee proposes to introduce an exit
clause for the lead partner in a special purpose vehicle (SPV)
for any project besides relaxing the termination norms.

The existing Model Concession Agreement (MCA) between
the developers and the government has tough clauses for exit
of the lead partner in special purpose vehicles for projects,
besides the termination clause allows NHAI to take tolling
rights from the developer, sources said.

The Prime Minister had set up the committee, which also
comprised Finance Secretary Ashok Chawla and Road Transport
and Highways Secretary Brahm Dutt, on August 7 giving it two
weeks for submitting detailed report.

The government has set an ambitious target of developing
35,000 km of highway in the next five years linking 300
populous district headquarters with the road network.

The committee had also met bankers and financial
institutions to make the roads bankable projects.

Bureau Report

First Published: Tuesday, August 25, 2009 - 19:33
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