NHAI wants farmers’ strike at Delhi-Haryana border to be considered force majeure
The agitation of farmers on the Delhi-Haryana border is considered an “indirect political major force”.
In this case, it will allow toll chargers on one of the busiest highways in the country to compensate for the loss of income.
Last year’s nationwide lockdown was cited as a force majeure incident, leading the Union government to grant toll operators a similar waiver across the country.
The proposal to allow “indirect force majeure” has been prepared by the National Highways Authority of India (NHAI) and has been submitted for approval to the Union Ministry of Road Transport and Highways.
In a letter to the ministry, NHAI said the event should be treated as a political force majeure. Therefore, he said, the company’s concession period should be extended while still allowing for the payment of interest on the debt, depending on the initial finance package.
NHAI believes that the agitation of farmers has led to the end of the toll in the squares.
“It has been decided that the loss due to the above turmoil should be dealt with in accordance with the terms of the concession contract,” NHAI said.
Certain clauses in the agreement state that if the project developer is unable to collect the royalties despite his best efforts or has been ordered by the authority to suspend the collection of the royalty, the concession period is extended d ‘a period during which the concessionaire was prevented from collecting charges.
In the event of partial collection of the fee or when the daily collection is less than 90 percent of the average daily fee, the authority extends the concession period in proportion to the loss of the fee on a daily basis.
Regarding the payment of interest on the debt, it must be made in accordance with the original financial package presented at the time of financial close.
The concessionaire must provide details of operations and maintenance (O&M) expenses to the authority. For any other payment, the management can take an appeal on a case-by-case basis.
“Care must be taken that the NPV (net present value) of all force majeure reimbursements as well as the extension of the concession period are capped at the maximum loss of toll revenue suffered during the force majeure period”, indicates the letter.
The authority also suggested that 75% of the total claim amount obtained could be paid immediately in order to maintain the reconciliation margin.
The farmers’ protests began on November 25, 2020, when farmers, mostly from Punjab and Haryana, marched to the nation’s capital, demanding a complete repeal of the legislation. The three laws are the Agricultural Trade and Commerce (Promotion and Facilitation) Act of 2020; Essential Products (Amendment) Act 2020; and Farmers (Empowerment and Protection) Agreement on Price Assurance and Farm Services Act, 2020.
The farming community believes these laws will abolish the government-guaranteed Minimum Support Price (MSP) on certain crops, leaving them at the mercy of big business.