Nitin Gadkari Affirms Commitment to Revive BOT Model, Aiming for Investment-Friendly Infrastructure and Attractive Private Partnerships

To encourage Public Private Partnership for Build-Operate-Transfer (BOT) projects and foster ease of doing business, Ministry of Road Transport and Highways (MoRTH) organized a conference with industry stakeholders like Concessionaires/ Contractors, Highway Operators, Investment Trusts, Bankers/ Financial Institutions, Technical & Financial Consultants  from the road sector in New Delhi. The conference was inaugurated by Shri Nitin Gadkari, Union Minister for Road Transport and Highways. Shri Anurag Jain, Secretary, MoRTH, Sh. Santosh Kumar Yadav, Chairman NHAI and senior officials from Ministry of Road Transport & Highways, National Highways Authority of India, NHIDCL, NITI Aayog, Department of Economic Affairs, Department of Financial Services, Department of Legal Affairs were also present on the occasion.

Speaking on the occasion, Shri Nitin Gadkari said that “We are committed to revive BOT model and make it investment friendly and attractive for private partnerships. This will not only strengthen the road infrastructure but will have a ripple effect that will help to strengthen the economy, increase the employment potential and reduce the logistic cost.”

The conference saw presentations made by senior NHAI officials on the proposed modifications in the Model Concession Agreement (MCA) of BOT (Toll) to address concerns and remove roadblocks highlighted by the stakeholders. The proposed modifications include various provisions to eliminate discrepancies such as determination of termination payments, modifications in Concession Period based on actual traffic (PCU) Vs tolling groups of vehicles, actual traffic exceeding design capacity to be re-visited, and compensation for delays on the part of Authority as well as force-majeure cause to be clearly defined termination payments before project completion with a new provision of Buy Back in case of Additional Tollway/Competing Road.

At present, projects are being awarded on Engineering Procurement Construction (EPC) or Hybrid Annuity Mode (HAM) due to various challenges in implementation of BOT Projects. Many initiatives have been taken for revival of BOT projects and various schemes like Harmonious Substitution, One Time Fund Infusion, Rationalized Compensation, Premium Deferment and allowing refinancing have been adopted in the past. Going forward, 53 BOT (Toll) Projects for a length of 5200 km worth Rs. 2.1 lakh crore have been identified and bids for 7 projects with a Length of 387 km worth Rs. 27,000 crore have been invited.

As per the Government of India’s ‘Vision 2047’ Plan, a large number of high-speed corridors are envisaged to be developed. Robust Public Private Partnership in development of road sector will play a pivotal role in realizing this vision and will greatly contribute towards the development as well as Operation & Maintenance of a world class National Highway Network in the country.