MoRTH revises BOT and TOT agreements to boost private sector investment

26 Mar 2024 CW Team

The Ministry of Road Transport and Highways (MoRTH) has introduced a number of revisions to the model concession agreements (MCA) for build-operate-transfer (BOT) and tolling, operation, maintenance, and transfer (TOT) projects. These changes aim to encourage private sector investment in road infrastructure and clarify existing agreements. Key amendments for BOT projects include providing construction support to ensure timely project completion and extending tolling periods to offset losses due to competing roads. The updated MCA also specifies compensation for force majeure events and termination payments if 40% of the project is complete during construction. Additionally, debt and equity provisions aim to align project costs with government projections. Furthermore, the authority will continuously access escrow account statements to prevent funding shortages and project delays. The road ministry notified that these amendments were made following extensive consultations with stakeholders and implementing agencies. Changes in TOT agreements include increasing the frequency of checks to three times and lowering the threshold for variation in toll collection to 5%. These adjustments ensure upfront modifications to the concession period based on toll collection variations. Akshay Purkayastha, Director of Consulting at CRISIL Market Intelligence and Analytics, views the amendments positively, particularly regarding debt obligations, capacity enhancement, and compensation clarity. However, the impact of these changes on BOT projects' revival remains uncertain. Under MoRTH, the National Highways Authority of India plans to auction 53 projects worth over Rs 2,200 billion, covering 5200 kilometres. Currently, projects predominantly follow engineering procurement construction (EPC) or hybrid annuity mode (HAM) due to implementation challenges with BOT projects.

Infrastructure Urban

16 Jun 2025

MoHUA Plans New Role for Smart City SPVs

In a significant policy move, the Ministry of Housing and Urban Affairs (MoHUA) has issued an advisory encouraging the continued use and repurposing of Special Purpose Vehicles (SPVs) formed under the Smart Cities Mission (SCM). This marks a step toward sustaining urban transformation by leveraging institutional capabilities and infrastructure developed over the past decade.Initiated in 2015, the Smart Cities Mission introduced a new era of urban planning in India, with each of the 100 selected cities forming SPVs under the Companies Act, 2013. These entities, jointly owned by state government..

ADB Approves $110 Million Loan to Boost Skills in Gujarat

The Asian Development Bank (ADB) has approved a USD 109.97 million (Rs 9.27 billion) results-based loan to support Gujarat’s efforts to become a global industrial hub by developing a future-ready, skilled workforce.The funding will back the Gujarat skills development programme, led by the Department of Labour, Skill Development and Employment in collaboration with Kaushalya: The Skill University (KSU). The initiative aims to equip the workforce with advanced, industry-aligned skills to meet rising employment demand in high-growth sectors.According to ADB, the programme seeks to strengthen in..

SDAL Tests Rudrastra UAV and Bhargavastra Defence System

Solar Defence and Aerospace Limited (SDAL) has successfully completed a key flight test of its indigenous Hybrid VTOL UAV Rudrastra at the Pokharan Firing Range, aligning with Indian Army performance benchmarks for mission adaptability, high endurance, precision engagement, and vertical take-off and landing (VTOL) capability.The trial marks a notable achievement in India’s Aatmanirbhar Bharat initiative, underscoring advancements in home-grown military technology. The Rudrastra UAV demonstrated a mission radius exceeding 50 km with uninterrupted video relay, a total operational range of over..