Question

Which of the following statements is true regarding the build-operate-transfer (BOT) model?

• A. It is facilitated through a contract of two private companies.
• B. Sometimes, private companies hold the ownership in this model.
• C. The government never takes up the management of the project in the BOT model.
• D. There are no provisions of recovering investments by private companies in the BOT model.

Answer 1

The correct option is B Sometimes, private companies hold the ownership in this model.

A build-operate-transfer (BOT) contract is a model used to finance large projects. Through BOT, the government enters into a contract with private companies for building a project. Private players are allowed to recover their investment before transferring the ownership of the project to the government. Sometimes, the government manages the project, while the private players own it in BOT contract.