Instituting a dedicated project account can instill cash flow discipline and ensure the exclusive use of payments for the project thus avoiding cash flow problems that can hinder work progress. Contractors in road construction projects in India generally face cash flow issues while executing the project because the funds they receive are diverted from the project to other purposes. This disrupts progress. Instituting a dedicated project account can instill cash flow discipline and ensure effective utilization of payments from the executing agency to the contractors for the exclusive use for the project and, thus, help expedite work progress. This arrangement, which proved under this project, can be replicated in future contracts and in other states.
Second Jharkhand State Road Project