Evaluate the Build Operate Model of Private Public Partnership in the context of road infrastructure of the country. (200 Words)
Refer - Business Line
Enrich the answer from other sources, if the question demands.
K. V. A 2 years
Pls review
IAS Parliament 2 years
Avoid using short forms and try to expand. Keep Writing.
IAS Parliament 2 years
KEY POINTS
· National Highway Authority of India (NHAI) announced its plan to award at least 8 per cent of the targeted road development for the current fiscal through Build-Operate-Transfer (BOT) route.
· The study by ICRA has revealed that 70 per cent of the sample projects defaulted during the operational phase, largely on account of lower than envisaged traffic and authority-related issues.
· Only one-fourth of the projects could come out of default and nearly 16 per cent of the projects were terminated.
· Although NHAI protects the concessionaire against losses caused by delays in approvals and land acquisition, the delays will ultimately impact the project execution and its cash-flows.
· An easy way was discovered through book entries showing upfront equity infusion into the SPV and immediate plough back of the same to the sponsor as mobilisation advance.
· The traffic projections made in the absence of any reliable historical data, drawn based on certain assumptions, have largely been flawed.
· In the case of road projects, the traditional debt-restructuring mechanism did not work because it required a committed and sustained financial support from the concessionaire and the project owner.
· While a stalled road project is a loss proposition for all stakeholders (i.e., concessionaire, lender and project owner), the lender bears the lion’s share of the financial loss (nearly 75 per cent of the cost incurred).
PANDI SANTHOSH RAJA S 2 years
Kindly review
IAS Parliament 2 years
Good attempt. Keep Writing.
