The Union Cabinet will take the final call on the ways private sector highway operators could be compensated for their losses on toll collection due to the government’s move to waive off user fees in the wake of the currency crunch after demonetisation.
Sources in the ministry of road transport and highways (MoRTH) said a Cabinet note is being prepared now which will be placed before the government’s highest decision-making body soon and depending on its directive, the National Highways Authority of India (NHAI) will spell out the compensation.
After demonetisation, the government had suspended toll collection on all national highways with effect from November 23, which continued till the midnight of December 2. However, compensation is required to be paid to around 85 BOT (toll) projects of NHAI operated by private players which collect around Rs 40 lakh as toll each day.
NHAI had in a circular on December 6 proposed to provide the BOT (toll) concessionaires immediate relief by proposing to pay 90% of the interest amount on submission of the required documents, as provided in the financial/refinancing package (under clause 34.5 of the concession agreement) for the period during which tolling was suspended.
Concessionaires, however, were not happy since the compensation does not cover the debt repayment obligation. They wanted it to be viewed under clause 34.4 (a) which states that if the aggregate financial effect exceeds the higher of Rs 1 crore or 0.5% of net realisable fee in any accounting year, it comes under clause 41 of the concession agreement, which is Change in Law.
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Under clause 41, NHAI is obligated to place the concessionaire in the same financial position as it would have enjoyed had there been no such change in law.
A senior NHAI official, however said: “The model concession agreement for BOT (toll) projects suggest that NHAI would enhance the lease period by the number of days the concessionaire failed to collect users’ fee due to force majure. We intend to go by the agreement.”
“Their actual collection with our estimates could vary,” he said, adding that the mode of the compensation is yet to be finalised, but it might not take long to decide.