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GoI's Proposal to Auction 111 EPC Projects: A Move to Unlock INR 55,000 Crore Through Global Pension Funds

News

Road Ministry is finalizing a proposal that will allow global pension funds to buy directly into existing Govt-owned EPC projects. Government is hoping to raise close to Rs 55,000 crore through auction of 111 EPC projects by the end of the current financial year.Government will guarantee 8 percent return for 30 years and toll rights to ensure investor interests are guarded.

Source: ET

SNP Insights

This auction is expected to catch the interest of investors as they have to deal only with operational risk rather than construction risk associated with conventional Infrastructure projects.With the government's guarantee of 8% over 30 years this auction is expected to unlock  funds tied with these projects and can act as a model project for other sectors to follow.

Source: SNP Infra Research