EPC vs. HAM Projects – Understanding the Future of Infrastructure Development

Introduction:
The infrastructure sector operates under multiple financial and execution models. Two of the most prominent are the EPC (Engineering, Procurement, and Construction) model and the HAM (Hybrid Annuity Model). Understanding the differences between these models is crucial to grasp how India’s infrastructure is built and financed.

What is the EPC Model?

• The contractor is responsible for the entire project—from design to execution.
  
  
• The government or private entity provides 100% of the funding.
  
  
• Commonly used for large-scale projects like highways, expressways, and metro systems.
  
  
• HMPL’s EPC Projects:
  
  
  • Samruddhi Mahamarg
    
    
  • Mumbai-Goa Highway Package
    
    

What is the HAM Model?

• A mix of government funding (40%) and private investment (60%).
  
  
• The private company constructs the project and receives annuity payments over time.
  
  
• Ensures long-term financial sustainability for developers.
  
  
• HMPL’s HAM Projects:
  
  
  • Mumbai-Goa PKG-6 Project
    
    

EPC vs. HAM – Which is Better?

Factor	EPC Model	HAM Model
Funding	100% by the government	40% by the government, 60% private
Risk	Higher for the contractor	Shared between government & contractor
Payment	One-time payment post-construction	Recurring annuity payments
Suitability	Large-scale infrastructure projects	Long-term public-private projects

Conclusion:
Both EPC and HAM models have their unique advantages. As a leader in infrastructure development, HMPL strategically undertakes both types of projects to contribute to India’s growth efficiently and sustainably.