India's largest highway project to GMR set to be terminated by NHAI and road ministry
Analysts had doubted the financial viability of the project, considering high premium that the company had quoted.

Top road ministry officials told that the "special dispensation" sought by the developer, GMR Infrastructure Ltd, to start work on the 555 km highway stretch costing Rs 7,700 crore, has been turned down by both NHAI and the road ministry. "Now there is no scope of contract to continue," a government official said.
Analysts had doubted the financial viability of the project, considering high premium that the company had quoted.
For the past two years, there have been several rounds of discussions and communications between GMR and NHAI with the intent to revive the project. It was awarded during a phase when most of the highway projects were bid out with premium. Highest ever premium was quoted for this stretch, which is one of the busiest corridor.
In fact, to revive such projects the UPA-II had come out with a premium rescheduling policy and the deferment of premium has been sanctioned to 13 such projects so far.
The infrastructure major had recently written to the road ministry, asking for rescheduling its premium payments. Sources said GMR wanted 75% of the premium to be rescheduled. It also wanted that any surplus in toll collection, left after servicing debt and premium obligations, should not be withdrawn by NHAI. It should be left in an escrow account, to be used for maintenance of the project when the need arises.
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