Development of Risk-Based Asset Management Framework for Highway BOT Projects in Pakistan

Abstract

Infrastructure investments are essential to foster the economic growth of a nation and providing a platform in which new forms of partnerships and collaborations for project delivery can be explored. Owing to the scarcity of financial outlay in public sector agencies to develop and maintain the infrastructure, public-private partnership as one of the project delivery method has gained wide acceptability world over. Built operate transfer (BOT) as part of public-private partnership is considered a viable substitute to conventional public funding for infrastructure development projects. Private sector or promoter/ concessionaire of the BOT project are exposed to multiple risks which necessitate effective risk management methods in ensuring the success of such projects. This research work identifies major risk factors contributing towards the highway asset management of BOT projects. A questionnaire-based survey was employed to various stakeholders including clients, consultants, and contractors and 69 risk factors were analyzed and ranked using statistical tool PASW-18. The study revealed that the selection of inappropriate project; improper pre-bid evaluation of the project; entering into loose concession; selection of inexperienced construction and supervision team during construction phase; weak management and maintenance team for operational phase are the major contributing factors for the poor highway asset management of the BOT projects in Pakistan.