Tweaking BOT model can drive up investments worth Rs.40-50 trillion
ECONOMY & POLICY

Tweaking BOT model can drive up investments worth Rs.40-50 trillion

Reworking of the build-operate-transfer (BOT) model may drive up investments worth Rs.40-50 trillion in the road sector in the current financial year, India Ratings and Research (Ind-Ra) said.

Revival of the BOT model, with features that provide significant risk mitigation compared to the earlier model, is likely to increase the share of these projects from FY25.

Ind-Ra estimates capex requirements under this model to range between Rs.0.4 trillion-0.5 trillion in FY25 and the agency believes it would rise steadily to Rs.1 trillion by 2030.

The ratings agency said that revamping of the BOT model is a tactical move to attract private capex, which is estimated to surpass Rs.1 trillion by 2030.

While revamping of the BOT model is a welcome change, the impact of evolving infrastructure landscape such as competing roads and alternate modes of transportation (dedicated freight corridor and inland waterways) in bolstering BOT model remains to be seen.

Reworking of the build-operate-transfer (BOT) model may drive up investments worth Rs.40-50 trillion in the road sector in the current financial year, India Ratings and Research (Ind-Ra) said.Revival of the BOT model, with features that provide significant risk mitigation compared to the earlier model, is likely to increase the share of these projects from FY25.Ind-Ra estimates capex requirements under this model to range between Rs.0.4 trillion-0.5 trillion in FY25 and the agency believes it would rise steadily to Rs.1 trillion by 2030.The ratings agency said that revamping of the BOT model is a tactical move to attract private capex, which is estimated to surpass Rs.1 trillion by 2030.While revamping of the BOT model is a welcome change, the impact of evolving infrastructure landscape such as competing roads and alternate modes of transportation (dedicated freight corridor and inland waterways) in bolstering BOT model remains to be seen.

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