Govt Revises BOT Highway Rules to Boost Private Investment in National Highway Projects
The government said its infrastructure strategy focuses on developing access-controlled expressways, ring roads, bypasses, coastal roads, and improving connectivity to ports, airports and industrial corridors to strengthen India's logistics network and expand investment opportunities.
To make highway projects more attractive for investors, the government has amended the Model Concession Agreement (MCA) for PPP projects, revised Toll Operate and Transfer (TOT) contracts, introduced Public InvITs, and held stakeholder consultations with concessionaires, financiers and government agencies.
Key reforms in the BOT bidding and concession framework include allowing fund houses to bid based on their financial strength, provided they appoint technically qualified EPC contractors after project award. The revised framework also brings greater contractual clarity on provisions related to change in ownership, target traffic, force majeure compensation, damages, annual passes and change of scope.
The government has also introduced termination compensation before the Commercial Operation Date (COD) for projects with at least 20% physical progress, safeguarding the interests of concessionaires and lenders. In addition, debt due provisions have been streamlined to reduce ambiguities.
The dispute resolution mechanism has also been simplified. The Dispute Resolution Board has been abolished, with disputes below Rs 10 crore to be resolved through arbitration, while disputes of Rs 10 crore and above will be settled through conciliation or mediation.
Published on:
13 August 2026
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