A chorus of approval from the worlds of business and politics greeted the news yesterday that after 60 years of dithering, delay and disagreement, Glasgow is to get its southern ring-road.

Ministers announced that a deal had been struck to complete the M74. The missing link in Scotland's road network is to go ahead after tough final negotiations with the sole consortium bidding to complete the five miles of six-lane motorway.

There was near universal political and business support for the announcement, with only the environmental lobby and its political arm, the Greens, voicing serious dissent.

At £650m the project is up by around £100m on the last estimate but, crucially, the government has been able to build in a cap on the deal which means the cost cannot escalate from now until completion in 2011, ahead of the new road's crucial role in the 2014 Commonwealth Games.

The tender bid by the Interlink M74 consortium is a fixed price of around £445m plus an allowance for around £12m for possible treatment of mine workings along the route, on top of £200m spent.

Transport Minister Stewart Stevenson said: "Following an internal review of the procurement processes, the government is confident that the procedures are robust and we are happy for Glasgow City Council to award the contract to the Interlink M74 Joint Venture. This extension will complete the motorway network and reduce congestion on the busiest stretch of the M8 through Glasgow.

"This project is also a crucial piece of the infrastructure which is required to provide excellent transport facilities for the visitors and athletes expected in the city as a result of the 2014 Commonwealth Games."

Glasgow Green MSP Patrick Harvie said: "Today is a dark day for Glasgow, and a dark day for all those campaigning to tackle climate change. A sham tender process has been concluded with a sham review and an entirely irresponsible decision, given that the European Commission may pull the plug on the process altogether."

Councillor Steven Purcell, leader of Glasgow City Council, said: "This is tremendous news for jobs, for commuters and for the 2014 Commonwealth Games."

There was praise from Mr Purcell's predecessor Charles Gordon, Cathcart MSP and former Labour Shadow Transport Minister at Holyrood, who said of the SNP transport minister: "I take my hat off to Stewart Stevenson."

The reason for that praise was the technical difficulty of negotiating a deal with construction giants at a time when the London Olympics is casting a huge shadow over the industry. The Green lobby had argued that the deal with a single consortium breached European rules but for the government to strike a bargain with a cap on the price is seen as a real achievement.

The price is almost double that envisaged when Donald Dewar's new Scottish Executive, and its then Transport Minister Wendy Alexander, first gave the go-ahead in principle. It should have been completed by now but a public inquiry and the environmental lobby fighting it put paid to that.

The CBI proclaimed: "The Scottish Government deserves warm congratulations for taking this tough decision so soon after obtaining parliamentary approval of their Budget."

The Scottish Council Development and Industry's chief executive Alan Wilson said: "After more than 30 years of stalling, the motorway network round Glasgow will be completed, reducing congestion and easing the movement of goods and services."

Labour transport spokesman Des McNulty said: "Labour believes the M74 extension is vital to the future economic progress of the West of Scotland and the regeneration of the east end of Glasgow in particular. It has been a long wait for the final go-ahead but Glasgow City Council have the vital task of ensuring that we get the maximum benefit from this massive new investment."

His Tory counterpart Alex Johnstone said: "The prompt and competently managed completion of the M74 extension is a vital part of meeting the commitments on athlete travel time that were made in the original bid document."