Wednesday, October 5 2005 15:20 Hrs (IST) - World Time -

New Delhi: The Cabinet Committee on Infrastructure today (Oct 05, 2005) cleared a Rs 10,000 crore Special Purpose Vehicle for funding infrastructure projects and the model concession agreement for highways.

"The Committee today considered and finalized two notes, one on SPV and another on the procedure for public-private partnership in road projects. They will go to the Cabinet Committee on Economic Affairs tomorrow (Oct 06, 2005) for approval," Finance Minister P Chidambaram said after the meeting of the committee chaired by Prime Minister Manmohan Singh.

The SPV will have an initial paid-up capital of Rs 10 crore. The authorized capital, however, has been fixed at Rs 1,000 crore. The borrowing limit for the current fiscal has been pegged at Rs 10,000 crore.

He said the details of the SPV and the model concession agreement would be made public after the CCEA clearance.

Denying any differences between Planning Commission and Finance Ministry on the proposed SPV, he said in today's meeting the structure, management, mandate, terms of lending and refinance were discussed. "There is a complete agreement on the note," Chidambaram said.

The Infrastructure SPV was announced in the Budget along with the Viability Gap Funding scheme of another Rs 1,500 crore. The two schemes along with the PPP scheme was proposed to give a thrust to the infrastructure projects that were not taking off due to paucity of funds.

The new model concession agreement for road projects on build, operate and transfer basis seeks to link the duration of concession period with the actual traffic realisation on the roads. The concession period would vary from 12-20 years.