NEW DELHI, Jan 27: In the face of a high number of projects being stuck for want of equity, Road Transport and Highways Ministry want norms to be eased to facilitate midway transfer of contracts by one developer to another.
“We are facing problems. Concessionaires are having the problems of equity. In order to have equity, we are seeking some relaxation from the Ministry of Finance so that the contracts could be transferred to other concessionaires even before two years,” Road Transport and Highways Minister C P Joshi told.
The present guidelines do not allow any developer to transfer the contract to another in the first two years.
The demand comes in the wake of majority contracts awarded last year remaining stuck for want of equity. On other hand, bidders including big infrastructure players like GVK and GMR have even walked out of projects midway.
Joshi also said the Ministry would ensure that eligibility criteria is not compromised if the midway transfer is allowed.
“We will not compromise with the eligibility criteria,” Joshi said. If there are 20 eligible bidders and the bid winner want to transfer the project midway to any of the other 19 qualified bidders, then it should be allowed, he said.
“We say after success of bid if somebody wants to give this to the other concessionaire, it should be allowed so that equity is not an issue. Last year, a number of concessionaires had participated in the bids. They are entitled to execute it, but they are in problem of equity,” Joshi said.
Contracts for more than 7,000 km were awarded in 2011-12 when bidders had aggressively bid for the same and has resulted in premium worth over Rs 3,000 crore to the government.
“If at this juncture it (transfer) is allowed and fresh concessionaire can come and infuse some funds, we hope that the large number of projects where successful bids took place will be in place,” Joshi said.
In view of economic slowdown, equity crunch and delays in environment clearances, the Road Transport and Highways Ministry, already under attack for failing to deliver projects in time, is unlikely to meet the target of awarding contracts for developing 9,500 km of roads by March-end.
The Ministry’s performance has suddenly come to a very poor low this fiscal where it has barely awarded projects for building 1,000 km of highways. (PTI)
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