Govt clears new dispute resolution mechanism for road sector

NEW DELHI: The government has cleared a proposal for adoption of a new dispute resolution mechanism for highway projects to ease legal and financial hurdles.

The Cabinet Committee on Economic Affairs in its meeting on April 22 cleared the proposal of Road Transport and Highways Ministry for creating a new three-stage dispute resolution mechanism, official sources said.

The dispute resolution mechanism will be adopted by the NHAI, sources said.

"Legal disputes and financial claims are quite often in many highways contracts," they said, adding that expeditious resolution of such disputes and settlement of claims is important from the point of view of timely implementation of the projects.

The old mechanism was not effective in expeditious resolution of disputes and claims.

Earlier this year major infrastructure players pulled out of mega road contracts as they were unable to arrange funding for those projects due to delays in land acquisition and environment and forest clearances.