NHAI’s Covid force majeure fraught with loopholes, say contractors

Following the notification of its Covid-19 related force majeure measures, the National Highways Authority of India (NHAI) is facing negotiations over several issues raised by road developers. Encashment of bank guarantees, non-payment of maintenance costs and lower estimation of revenue and expenditures are some of them.

NHAI in May announced compensation to address issues of losses due to non-collection of toll on highway stretches for 21 days and loss of traffic during the nationwide lockdown. The measures, however, road operators point out fall short on several counts. They say availing extension of the road concession period is not an easy task.

The relief to companies would, for instance, be available if the parties to the contract were not in default of the obligations on February 19. Under this clause, said an executive from a road company who did not wish to be identified,