HYBRID ANNUITY MODEL
On a High-way: India revamps highway EPC rules with rating-based deposits, crash penalties
The Centre has revised performance security measures for national highway contractors based on their ratings. Contractors rated above 80% will deposit 3% of project value, while lower-rated contractors will deposit 4% or 5%. This initiative aims to incentivize quality in highway construction and improve contractors' cash flow. Additionally, higher standards for land acquisition and compensation mechanisms have been established.
Alpha Alternatives raises over Rs 6,000 crore for first infrastructure fund
Alpha Alternatives has garnered over ₹6,000 crore for its initial infrastructure fund, which is set to focus on key projects such as roads and renewable energy frameworks. The Build India Infrastructure Fund's goal is to improve operational efficiencies and eventually monetize assets through investment trusts. Meanwhile, Bajaj Alternate Investment Management is initiating fundraising for its first real estate venture centered on commercial office properties.
Ircon to monetise 4 highway assets; PSU plans to unlock 3,000cr value as part of GoI's infra monetisation
Ircon International has placed four highway assets for sale in a government-led monetisation programme. These assets include toll-road and hybrid annuity model projects located in Madhya Pradesh, Rajasthan, Karnataka, and Gujarat. The enterprise value of the assets is estimated to be around ₹3,000 crore, as advised by Axis Capital. Currently, Ircon is a Navratna company primarily earning from its railway segment.
Highway projects get three more months of bitumen, diesel cost escalation cover amid West Asia crisis
The ministry of road transport and highways is extending the cost compensation for bitumen and diesel. This extension will apply to projects executed until December 31, 2026. Work carried out will only qualify if the bid due date was set before April 1, 2026. The compensation aims to address the impact of rising diesel prices on highway construction.
India's infrastructure challenge shifts from raising capital to making projects investable: Deloitte
India's infrastructure challenge has evolved from capital raising to the need for investable projects. A significant proportion of respondents view private-sector participation and complex approval processes as major obstacles. The report emphasizes the necessity of modernizing infrastructure through digital technologies and enhanced cyber defenses. Public sector initiatives have successfully attracted private investment in greenfield sectors like renewables and highways.
Hill-house backed Elevate Campuses raises Rs 945-crore anchor book
Hillhouse-backed Elevate Campuses raised Rs 945 crore from 20 anchor investors, including major mutual funds and Norges. The amount represents 60% of its QIB allocation ahead of its Rs 2,100 crore IPO, which opens Wednesday and closes Friday.
National highway contractors must get government permits for foreign workers, ministry clarifies
National highway contractors must obtain government permits for hiring foreign workers. Any change in concessionaire ownership requires prior designated authority approval. Such employment is subject to regulatory approvals, including visas and work permits. Refusal of permits will not excuse concessionaires from their contractual obligations. The ministry issued a revised model concession agreement for national highways.
First-ever full toll suspension: Expressway develops defects weeks after opening; NHAI bans concessionaire for 3 years, seeks Rs 42 lakh daily compensation
NHAI PNC Infratech Ban: Following the inauguration of the Kanpur-Lucknow Expressway, significant defects were reported, prompting the National Highways Authority of India (NHAI) to bar PNC Infratech from bidding for its projects for three years. Several sections of the expressway suffered premature failures, leading to the suspension of toll collection, while PNC Infratech is required to compensate NHAI for the lost toll revenue on a daily basis. The company’s shares also fell sharply after the NHAI action was disclosed.
GR Infraprojects shares drop 2% after terminating contract with NTPC. Here’s why
Shares of GR Infraprojects fell 2% after the company issued a notice to terminate its contracts with NTPC for a Battery Energy Storage System project at Mouda Super Thermal Power Station. The termination follows continuing force majeure and war-risk circumstances, along with contractual issues. GR Infraprojects has invoked the dispute resolution mechanism and is assessing the financial impact of the move.
NHAI makes 80% plantation key to highway completion certificate
National Highways Authority of India now requires 80% plantation coverage for project completion. A minimum 90% sapling survival rate is also mandated for provisional certification. Financial withholdings will enforce outstanding plantation work completion and target achievement. Payments during the operations period will link to maintaining plant survival rates. Timely replacement of dead or damaged plants is now a mandatory requirement.
After two-year slowdown, national highway project awards fast-tracked
National Highways Authority of India is accelerating project awards for the upcoming fiscal year. Seventy-two percent of identified projects are on track for early award. This rapid pace aims to reverse a recent slowdown in infrastructure development. Many projects require ministry and cabinet approvals before bidding commences. Uttar Pradesh and Telangana will receive the most highway projects.
Kanpur-Lucknow Expressway slippages point to design issue, affected stretches need rebuilding: Official
Slippages on the Kanpur-Lucknow Expressway suggest design issues, not construction defects. Affected stretches will require rebuilding from the ground up, according to a government official. A preliminary investigation pointed to weak soil and poor drainage as contributing factors. The expressway was executed under a Hybrid Annuity Model, with private developers responsible for maintenance. The central government awaits a final expert report on the expressway's structural integrity.
NHAI to bid out 54 highway projects worth Rs 1.80 lakh cr in FY27
National Highways Authority of India plans to bid out 54 projects this fiscal year. These projects will cover 2,442 kilometers with a capital cost of Rs 1.80 lakh crore. This is a significant reduction compared to the previous year's identified projects. Projects will be awarded across thirteen states using various construction models. The identified highway projects are spread across Andhra Pradesh, Bihar, and Delhi.
Highway building gathers pace in Q1
Highways would have been constructed at a faster pace but for the irregular rains, said officials. Sector watchers said the upcoming state assembly elections in December could also cause some delays once the model code of conduct for the polls kicks in.
Construction cos prefer pure EPC jobs to annuity projects
The key reason for this shift is the inability to secure financial closure for existing HAM projects.
Government clears eight highway projects worth Rs 6,000 crore
Of the eight projects, two will be undertaken on the newly-conceived hybrid annuity model. Six will be taken up on government-funded EPC model.
Rs 40,000 crore road projects on hybrid model by March: Nitin Gadkari
Nitin Gadkari said that the government by March will award projects worth more than Rs 40,000 crore on the new hybrid model.
Government approves hybrid annuity model for highway projects
Under this model, the government will provide 40% of the project cost to the developer while the remaining investment has to be made by the developer.
Four infrastructure companies bid for Rs 700 crore Meerut-Bulandshahr highway project
The Hybrid Annuity Model (HAM) is a mix of engineering, procurement and construction and build-operate-transfer formats.
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