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|June 5, 1997||
Govt dangles real estate carrot to develop highways
To infuse fresh capital into the road sector, the government will allow investors to develop townships and other real estate on land made available to them.
Unlike the highways which are approved on ''build, operate, transfer'' basis, the real estate projects will not go back to the government, according to a Union Cabinet decision.
So far, under the road policy announced by the government, private parties were only allowed to develop highway facilities like motels and hotels.
The Cabinet approved the proposal for levying toll on four-laned national highways to improve their capacity. The government earlier announced fiscal incentives including tax concessions to entrepreneurs to attract private capital for road development. The highest rates of toll approved for each class of vehicles are: cars, jeeps and vans 40 paise per km, light commercial vehicles 70 paise per km, trucks and bus Rs 1.40 per km and heavy construction machinery Rs 3 per km.
Actual rates will be decided on a case-to-case basis, keeping in view the cost of the project, financial viability and public acceptability. The rates will be reviewed periodically by the government.
The ministry has been authorised to levy higher rates of toll for expressways, major bridges, new bypasses and tunnels after competitive bidding. Profits ploughed into highway projects will be eligible for tax concessions available to the infrastructure sector.
Minister for Surface Transport T G Venkatraman said the government had expedited projects worth Rs 10 billion.
The National Highways Authority and the government have been permitted to provide capital grants upto 40 per cent of the project cost.
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