Exit clause in roads under consideration: NHAI

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NHAI Project
New Delhi, Jul 15: National Highways Authority of India (NHAI) member, Dr A. Didar Singh on Wednesday, Jul 15 said that an exit clause in road projects had been suggested to the Finance Ministry and it was 'in the orbit of consideration'.

Dr Didar Singh was responding to suggestions made by leading industry players at the National Highways Development Conclave (NHDC) organized by the Confederation of Indian Industry (CII).

Hari Sankaran, managing director, IL&FS, highlighted the need for financing frameworks that recognize the different phases of construction and the attendant risks. He stressed that the consortium or concessionaire should be seen as a key partner by the government and not just as a service provider.

Suneet Maheshwari, chief executive, L&T Infrastructure Finance Co Ltd., said an exit clause would generate greater appetite to invest in roads sector. If the process and documentation was made more friendly and possibly more international investor compliant, it would help, he suggested.

However, Ajit Gulabchand, CMD, HCC Ltd and  Atul Punj, chairman, Punj Lloyd Ltd both spoke of the need for better and faster dispute resolution mechanisms. Referring to BOT contracts, Mr Gulabchand said that there was a long gap between TCP and actual project cost. Mr Punj said that unrealistic bidding by contractors needed to be restricted by NHAI.

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