Cabinet may clear new model for road projects

Concessionaire period to be linked to traffic volume on highway under the model

The Cabinet will soon take up the road transport and highway ministry’s proposal of allowing bidding for projects on a new model, the Least Present Value of Revenue or LPVR. According to the model, the concessionaire period will be curtailed if a spike in traffic volume allows the operator concerned to recover their investment before the expiry of the period.

LPVR auctions are conducted globally for giving expressway franchises, and are won by companies bidding the least present value of toll revenue. The project returns to the government after the contract expires. 

The new mechanism allows contracts to be extended