Highway ministry extends relief to road contractors till December this year

New Delhi: The highways ministry has extended relief measures for road contractors and concessionaires by three months, following a request from the industry.

The relief measures announced in June included extension of project timelines and payments on the basis of work done. They will remain effective till December 31 this year, a senior government official said.

ET reported on September 25 that the relief measures were likely to be extended.

“Whatever relief was given to contractors, it has been extended by three months,” a senior official aware of the matter told ET, adding that they are likely to be extended even further till March 2021.

The Ministry of Road Transport and Highways had received representations from the industry to extend the relief measures, which were put in place to mitigate the impact of the Covid-19 pandemic on contractors engaged in National Highways projects.

The measures were notified on June 3 by the ministry, which issued a letter last week to its implementing agencies that they have been extended by three months.

The ministry had permitted extension of project timelines by three to six months, payments to subcontractors via an escrow account and relaxation in Schedule H which enables monthly payments to contractors for work done.

The ministry also released retention money of contractors in proportion to work done.

The issue of compensation to concessionaires, however, remains unresolved. The issue, which was to be discussed with the finance ministry, is unlikely to be sorted out soon as government finances are constrained, the official said.

Toll operations were suspended across the country between March 25 and April 19, as per directions of the Ministry of Home Affairs (MHA) to comply with the nationwide lockdown.

The National Highways Builders Federation (NHBF), which represents companies such as L&T, Afcons, GMR Highways, NCC, Sadbhav Engineering, Reliance Infrastructure, Tata Realty and Infrastructure, and IRB Infrastructure, had sought extension of the relief measures.

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