The ministry of road transport and highways (MoRTH) have made over a dozen changes to the model concession agreement for build-operate-transfer (BOT) and tolling, operation, maintenance and Transfer (TOT) model to incentivise private sector to invest in creation of road infrastructure and to remove any ambiguity in the existing agreements.
Some of the key amendments for capacity augmentation on BOT include construction support to the concessionaire to complete projects on time and longer tolling period to tide away losses on account of competing roads.
Besides, the amended MCA provides for clarity on the compensation to be paid by the government on account of force majeure, providing for a termination payment during construction period if 40% of the project is complete while incorporating debt and equity related provisions that will equate the cost of the project to the government projected total project cost.
Further, the authority will have the right to view and download the account statement of escrow account at all times during the concession period, a move aimed at ensuring that projects are not stuck due to paucity of funds.
“After extensive deliberations with various stakeholders and implementing agencies in this ministry, amendments have been approved in the provisions of the MCA for capacity augmentation on BOT (Toll),” the road ministry said in a notification.
Under the amended model concession agreement for TOT projects, the frequency of checks has been increased from two to three times to ensure corresponding changes in the concession period are made upfront in case there is variation in toll collection while the threshold for checking has been reduced from 20% to 5%.
The National Highways Authority of India, under MoRTH, aims to bid out 53 projects worth over Rs 2.2 lakh crore and covering a length of 5200 km.
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.
The government has taken many initiatives in the past for revival of BOT projects including schemes like harmonious substitution, one time fund infusion, rationalized compensation, premium deferment and allowing refinancing.
