Q. With reference to the “Hybrid Annuity Model (HAM)”, which of the following statements is/are correct?
1. It is a mix of Build-Operate-Transfer (BOT) and Engineering, Procurement and Construction (EPC) models.
2. Under HAM 50% of the project cost is born by the government.
Select the correct answer using the codes given below:

[A] 1 only

[B] 2 only

[C] Both 1 and 2

[D] Neither 1 nor 2

Answer: A

In India, the new HAM is a mix of BOT Annuity and EPC models.  

As per the design, the government will contribute to 40% of the project cost in the first five years through annual payments (annuity). The remaining payment will be made on the basis of the assets created and the performance of the developer. 

Source: TMH Ramesh Singh