Cabinet Committee on EcÂoÂnomic Affairs (CCEA) would decide on the proposal to prescribe a suitable cap on budgetary allocations for annuity payments for the PPP projects.
If the proposal is cleared, government would set a timeline till which future budgetary options can be foreclosed for making payment to the concessionaire for financing, construction, operation and maintenance of a PPP project.
The government is of the view that annuity payments under PPP projects create a burden on future budgets for a long period of time, making future budgets become inflexible and committed.
Annuity payments are essentially in the nature of deferred budgetary payments as they are typically borne by the government out of the annual budgetary allocations spread over time.
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