Change process of awarding road projects

The government should consider providing annuity to projects where the traffic level reaches a viable level in a couple of years,he said. If the traffic is likely to reach such a level,say after five years,the project could be supported by annuity and thereafter it could become a normal toll based project, Kohli said at a Ficci seminar on Thursday. The chairman also pushed for a system of rating SPVs so that they get easier access to bank finance.

As far as DDT is concerned,he suggested that there was dual DDT on SPVs. The SPV has to pay DDT on the amount of dividend declared to the holding company and the holding company has to again pay DDT on dividend declared to parent company. To avoid double taxation,it is suggested that the project SPV be allowed to bid for more projects say and channelise profits towards equity of the new projects, Kohli said.