Oct 3 2017 | India Opportunities

Highways construction on EPC and Hybrid annuity mode revives private sector participation

According to the NHAI data, of the highway projects awarded till May 31st, 38 projects have been awarded on EPC, 35 on hybrid-annuity and 4 projects on BOT (build-operate-transfer) mode. Hybrid-annuity contracts have revived the private sector participation in highway projects. Such project are maintained by the concessionaire even after the construction is over.

EPC projects gives liquidity to the contractors and are generally preferred over BOT or hybrid-annuity projects. EPC projets are handed over by contractors as soon as they are completed. To revive interest of private sector in highway construction, the Government is likely to focus on continuing with EPC projects. Hybrid-annuity project is preferred by the Government as lumpsum funds need not be parked in just one project. In such projects, the central government pumps in 40 per cent equity while the remaining is arranged by the concessionaire.

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