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The Union Ministry of Road Transport and Highways has revised the Build-Operate-Transfer (BOT) model concession agreement to create a more balanced risk-sharing structure between the government and private contractors. Union Minister Nitin Gadkari announced that BOT projects worth over INR 2 lakh crore will now operate under updated terms, including a 10-15 year defect liability period and a profit-sharing system linked to traffic data. The government is also investing INR 40,000 crore to address 350 landslide-prone highway locations and improve safety, while working on toll reforms and stronger coordination with states.
The Union government has revised the Build-Operate-Transfer (BOT) model concession agreement for national highway projects to ensure that risks and financial returns are shared more fairly between the government and private contractors. Union Minister for Road Transport and Highways Nitin Gadkari announced the changes at the third edition of the Build India Infra Awards held in the past week. Advertisement
The revised framework will apply to BOT road projects worth more than INR 2 lakh crore. Under the updated agreement, contractors will now have a defect liability period of 10 to 15 years. This means they will remain responsible for maintaining the quality of the road for a longer duration, ensuring better long-term performance of highway assets.
A key change in the agreement is the introduction of a system where profits and losses will be assessed jointly using vehicular traffic data. The intention is to create transparency in revenue assessment and allow both the government and concessionaires to share financial outcomes in a structured manner. This is expected to make the BOT model more stable after earlier challenges faced in attracting private investment due to traffic risk and revenue uncertainties.
The minister also informed that around 350 landslide-prone locations have been identified on national highways. To address these vulnerable stretches and improve safety, nearly INR 40,000 crore is being allocated. The focus will be on engineering interventions to prevent slope failures and strengthen road infrastructure in hilly regions.
In addition, the ministry is preparing a framework to enhance coordination with state governments in highway development. Under this approach, states may take responsibility for land acquisition, which has often been a major reason for project delays. The Centre is also working to improve toll collection systems to reduce congestion at toll plazas across the network within the current year.
The revised BOT agreement reflects continued efforts to revive the public-private partnership model in road infrastructure. In the past, several BOT projects had slowed due to funding stress and disputes over traffic projections. The updated structure aims to reduce uncertainty while ensuring accountability from contractors.
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