Financial Risks Mitigation for Greenfield Infrastructure Contracts
Author(s) -
Manoj Kumar Varma,
Anuja Shukla
Publication year - 2020
Publication title -
international journal of recent technology and engineering (ijrte)
Language(s) - English
Resource type - Journals
ISSN - 2277-3878
DOI - 10.35940/ijrte.d9254.018520
Subject(s) - finance , business , financial risk , payment , order (exchange) , government (linguistics) , financial intermediary , risk management , financial system , linguistics , philosophy
The Developing economies across the World witness huge Government spending on Infrastructure in order to boost their economy. Mainly these are Greenfield Projects (the projects/investments which are started from scratch level) and require a lot of Financial Planning at pre and post Contract Award level. This research paper identifies and proposes mitigation measures against the Financial Risks involved in Greenfield Infrastructure Contracts namely: 1) Financial Risks due to locked-up bank guarantees, 2) Financial Risks due to prolongation costs in case the works got suspended, 3) Financial Risks due to price escalation, 4) Financial Risks due to de-scoping of major part of the Works, 5) Financial Risks on account of delayed Payments and 6) Financial Risks due to delays and penalties.
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