The order from the Ministry of Road Transport and Highways says that bidders need to have a credit rating of BBB and above to build highways under Build, Operate, Transfer (BOT), and Hybrid Annuity Model (HAM) modes. This is a new provision added in the eligibility criteria for PPP projects
Companies that have developed linear projects like airport runways, railways tracks, yards for keeping containers, metro rail, and ports can participate in bidding for capital intensive highways as well. This became possible after the centre relaxed the eligibility criteria which bidders need to meet for developing highway projects under the public private partnership (PPP) mode.
But the order from the Ministry of Road Transport and Highways also said that bidders need to have a credit rating of BBB and above to build highways under Build, Operate, Transfer (BOT), and Hybrid Annuity Model (HAM) modes. This is a new provision added in the eligibility criteria for PPP projects.
Due to the critical nature of highways, the centre wants to ensure that only companies that have executed tasks of scale are allowed to participate in bids. This measure is also taken to keep a check on fly-by-night operators that do not have the expertise to execute projects and may bid unrealistically, hampering the outcome.
The eligibility criteria requires bidders to have financial and technical capacity. This mandates the bidder to have a minimum net worth and have worked on a project in the related core and highways sectors. Companies also need to ensure that they have completed at least one similar work of 20% of the estimated project cost.
