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A passage on Infrastructure and PPP
Introduced in January 2016 to revive investments in road infrastructure projects, ____ has seen good initial success. It is a mix of the EPC (engineering, procurement, and construction) and BOT (build, operate, transfer) models. Under the EPC model, NHAI pays private players to lay roads. The private player has no role in the road’s ownership, toll collection or maintenance (it is taken care of by the government). Under the BOT model though, private players have an active role — they build, operate, and maintain the road for a specified number of years — say 10-15 years — before transferring the asset back to the government.
In the above model the support provided by the govt during the construction phase and later in annuities during the operation phase will be in the ratio of ____. What will come in the place of the blank? (2 marks)
20:80
50:50
40:60
70:30
10:90
- The passage is discussing a model introduced in January 2016 for road infrastructure investments.
- This model is a hybrid of the EPC (engineering, procurement, and construction) and BOT (build, operate, transfer) models.
- Under the EPC model, the government (NHAI) finances and contracts the road construction.
- In the BOT model, private players finance, build, and maintain the road, and then transfer it back to the government after a set period.
- The model involves government support during both the construction and operation phases.
- The ratio of government support during construction to annuities in the operation phase must be identified.
Option: 1, 20:80 is correct as the Hybrid Annuity Model (HAM), which is referred to here, typically involves this ratio.
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