The hybrid annuity model is relatively new in the Indian economy as the private investors are still reluctant to adopt this public–private partnership model. This paper aims at developing and proposing a suitable hybrid annuity model for a highway project in Gujarat, India. A detailed financial analysis has been carried out to compute the net present value and internal rate of return. It has been observed that the breakeven and payback period is obtained after about 8 to 9 years. The corresponding net present value is about 28.253 million Indian rupee. The corresponding internal rate of return as observed from the analysis is about 20%. Thereby, the HAM model has been found to be techno-economically suitable and feasible for the development of new highways in Indian subcontinent particularly in the stretches of low traffic density.