NHAI approaches PMO to save discarded road projects

The National Highways Authority of India (NHAI) has approached the Prime Minister?s Office to help restart highway projects abandoned by concessionaires and begin projects that were not previously able to attract any developers. The move follows the NHAI?s proposal to encourage investment in highway projects by allowing easier options for concessionaires to exit highway projects. The aim is to ease liquidity problems for concessionaries who are often unable to find investors for projects due to legal problems and are saddled with high cost debt. Many developers have been finding it difficult to invest in new projects without first exiting older projects. If the new policy is implemented, companies with expertise in operation and maintenance could take over executed projects vacated by the earlier concessionaires. NHAI is also seeking restructuring of premium payment commitments made by private developers to attract them. Other questions being debated are whether the NHAI should be a part of a supplementary contract for a project and whether the second contract should override the first contract with the existing developer.