GVK group pulls out of another NHAI project

Jan 15 2013, 01:34 IST
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SummaryGVK Power & Infrastructure on Monday terminated its road contract with the National Highways Authority of India (NHAI) for the 330-km-long Shivpuri-Dewas highway in Madhya Pradesh

GVK Power & Infrastructure on Monday terminated its road contract with the National Highways Authority of India (NHAI) for the 330-km-long Shivpuri-Dewas highway in Madhya Pradesh. The move comes days after the company cancelled the 555-km-long Kishangarh-Ahmedabad highway project with the central body.

“GVK Shivpuri Dewas Expressway, a subsidiary of the company, has terminated the concession agreement executed by it with the NHAI for four-laning of the Shivpuri Dewas section of NH-3 in Madhya Pradesh,” the firm said in its BSE filing.

GVK had promised to pay NHAI a little under Rs 3,000 crore (on an NPV basis using a 10 per cent annual discount) for the highway it was four-laning for a period of 30 years, starting with a payment of Rs 190 crore in the first year.

The 330-km-long road project, under Phase IV of the National Highways Development Project was awarded to the group in August, 2011.

The agreement was signed only in January this year. The GVK Group sent its first letter of displeasure to NHAI in less than a year and had given NHAI a time of 15 days to remove the hurdles. FE

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