The panel to resolve inter-ministerial differences over the proposal to reschedule premium payme-nts for a clutch of highway projects will have five members, apart from chairman C Rangarajan. According to sources, the group includes Planning Commission secretary Sindhushree Khullar, road ministry secretary Vijay Chhibber, NHAI chairman RP Singh, expenditure secretary RS Gujral and PM’s economic advisory council secretary Alok Sheel.
The panel, the creation of which was a cabinet decision on October 8, is expected to come out with recommendations in four weeks. “The first meeting of the group will be within a week or 10 days… the group is likely to finalise the matter in the second meeting itself,” an official source said.
FE had earlier reported that the proposal for premium rescheduling of a clutch of beleaguered highway projects will still have to go through another round of tough negotiations. “The objections raised by stakeholders continue to remain strong and even NHAI and the road ministry have differences on the proposal. Four weeks look tough to have a final outcome,” a source said.
Earlier, the Planning Commission had opposed the penalty of 0.5% of TPC as haircut for developers as being too low and said a set percentage of the premium be allowed for back-loading instead. Citing the example of GMR, it said the firm’s proposal to allow it to pay R70 crore instead of R636 crore (in the first year) is a wrong move.
Earlier, the finance ministry and plan panel had disagreed with the road ministry’s package for the projects, which entailed rescheduling of premium over R1 lakh crore. The finance ministry called the res-cheduling a moral hazard as it involves “uncalled-for change in contract norms” and insisted that any such succour would also come with the developers taking a haircut. The road ministry has proposed that either these projects ? that have run into problems due to the slowdown and delayed clearances ? be scrapped or rescheduling be allowed in an optimal manner. The premium recast formula includes no change in net present value (with discount rate of 12%) and a penalty of 0.5% of the total project cost.
