Major Relief To Contractors: Govt Agencies To Partially Release Bank Guarantees

Courtesy theprint.in

New Delhi: In a major relief to contractors in the country, Union Finance Minister Nirmala Sitharaman announced that government agencies will partially release bank guarantees to contractors so that contracts are partially completed to ease cash flows during the nationwide lockdown period necessitated by the novel coronavirus pandemic.

Following are the other key points which will benefit contractors:

* Government agencies to partially release bank guarantees, to the extent contracts are partially completed, to ease cash flows

* Extension of up to 6 months (without costs to contractor) to be provided by all Central agencies (like Railways, Ministry of Road Transport & Highways, Central Public Works Dept, etc)

* Covers construction/works, and also goods and services contracts

* Covers obligations like completion of work intermediate milestones etc. and extension of concession period in PPP contracts.