BOT Contracts to Finance Rail Projects

Ministry of Roads and Urban Development’s Advisor Gholamreza Salami said new Iranian railroads, including the one linking Chabahar to Zahedan, will be financed under Build-Operate-Transfer contracts, IRNA reported. A BOT contract is a model used to finance large projects, typically infrastructure projects developed through public-private partnerships. Under a BOT contract, an entity, usually a government, grants a concession to a private company to finance, build and operate a project. The company operates the project for a period of time with the goal of recouping its investment, before transferring the project to the government. BOT projects are normally large-scale, greenfield infrastructure projects that would otherwise be financed, built and operated solely by the government.