NHAI to rebid GVK's road project after missing Financial Close

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NHAI to rebid GVK's road project after missing Financial Close

The National Highways Authority of India (NHAI) has announced plans to rebid the Shivpuri-Dewas road PPP project in Madhya Pradesh.

The news come after on 14 January 2013 GVK Power & Infrastructure Ltd informed that GVK Shivpuri Dewas Expressway, a subsidiary of the company, terminated the concession agreement signed in January 2012 due to the company's failure to achieve financial closure for the project. The project had been approved by NHAI in September 2011.

First time, NHAI launched the project on design, build, finance, operation and transfer (DBFOT) basis in build, operation, and transfer BOT (Toll) mode of delivery. The concession period was be 29 years including construction period of 30 months.

The project value, Rs28.15 billion (US$464 million) at the time, would now be Rs40 billion (US$659 million) due to escalation in input costs.

Bids would be invited again on a build-operate-transfer (BOT) mode. NHAI is hopeful there would be good response for the rebidding, because the stretch has good traffic, which means enhanced revenue potential for private players.

The total length of the project, which will link Shivpuri and Dewas, will be 330 km. The project is part of the NH-3 from Km 236.000 to Km 566.450.

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