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Credit rating agency, India Ratings and Research (Ind-Ra) in its latest report has said that the revamping of the built-operate-transfer (BOT) model is a tactical move to attract private capex, which is estimated to surpass Rs 1 trillion by 2030, as per the government. The rating agency further noted that the road sector in India has been at the forefront of performance and innovation and has played a crucial role in shaping the country’s economic growth trajectory, with a CAGR of about 14% over the past decade. 

As per the report, during the past seven years, the government has successfully rolled out about 400 hybrid annuity model (HAM) road projects in India, worth over Rs 4 trillion, thereby balancing risk appropriately between private and public partners and boosted the public-private partnership  activity in the sector. Also, the government’s enhanced focus on monetisation via the National Monetisation Pipeline (NMP) has attracted foreign investors, including various sovereign wealth funds and pension funds. 

Ind-Ra further said that the government’s continued focus on infrastructure development, stable regulations, setting up an infrastructure financing bank i.e. National Bank for Financing Infrastructure and Development (NaBFID), promoting the adoption of surety bonds, and the introduction of FASTags have worked positively for the sector.