Road Transport Ministry Revises BOT Guidelines for Highway Projects

¨     The Ministry of Road Transport and Highways revised the Build-Operate-Transfer (BOT) guidelines on 11 May 2026.

¨     The revised framework aims to increase the participation of institutional investors in highway projects.

¨     The new rules apply under the Public-Private Partnership (PPP) model.

¨     Large funds and institutional investors can now bid for BOT highway projects.

¨     BOT stands for “Build-Operate-Transfer”.

¨     Under the BOT model, a private concessionaire finances, builds, operates, and maintains a highway project.

¨     The project is managed for a fixed concession period.

¨     The concession period for highway BOT projects generally ranges from 20 to 30 years.

¨     After the contract period ends, the highway asset is transferred back to the government.

¨     Sovereign wealth funds are now eligible to participate in BOT bids under the revised guidelines.

¨     Infrastructure funds and pension funds have also been included as eligible investors.

¨     Private equity funds, alternative investment funds, and foreign investment funds can also participate in the bidding process.

¨     Institutional investors will primarily be evaluated on the basis of their financial capability.

¨     Construction expertise can be arranged through concessionaires or engineering partners after contract allocation.

¨     BOT projects involve construction and implementation risks.

¨     The project is awarded before the highway construction begins.

¨     Toll-Operate-Transfer (TOT) projects involve the acquisition of already operational highways.

¨     TOT assets generate existing toll revenue for investors.

¨     Earlier, large investments were mainly concentrated in TOT assets.

¨     Under the earlier BOT framework, four national highway projects worth around ₹22,000 crore failed to attract bids.

¨     The government aims to increase the share of BOT projects in total highway allocations.

¨     Currently, BOT projects account for less than 5% of allocations.

The government plans to raise this share to 25% within the next two years.