Govt to rework PPP model, to push for infrastructure projects

Kelkar committee constituted to relook at the public private participation projects

GN Bureau | May 27, 2015


#infrastructure   #investment   #ijay kelkar   #arun jaitley   #ppp   #PPP   #public private participation  

The PPP (the public private partnership) has become a favourite model for building infrastructure projects and after encountering numerous hiccups the government has constituted a committee to relook and revitalise the model.

The panel’s terms of reference include reviewing the experience of PPP policy, analysis of risks involved in the projects and current framework of sharing of such risks. This would mean that the panel would have go for modifications to contractual arrangements of PPP, examine international best practices as well as institutional context.

Many private players have been seeking changes in contracts to make them more flexible for renegotiation, and to ensure land is bought beforehand.

Finance Minister Arun Jaitley in his budget speech for 2015-16 had made an announcement regarding re-visiting the existing PPP mode to execute such projects.

The 10-member panel to be headed by former finance secretary Vijay Kelkar has been entrusted to suggest ways on improving capacity building for effective implementation of PPP projects. Among the members of the committee are C S Rajan, Chief Secretary, Rajasthan Government; S B Nayar, CMD, IIFCL; Shekhar Shah, Director General, NCAER; Pradeep Kumar, MD, CBG, SBI; Vikram Limaye, MD, IDFC; P S Behuria, former IRS and Sudipto Sarkar, Barrister-at-law, Kolkata.

Also it contains a representative, not below the rank of joint secretary, from the Road Ministry as its member, while Sharmila Chavaly, Joint Secretary, Department of Economic Affairs, Finance Ministry is the Member Secretary.

The panel is likely to consult various stake holders in private sector, government sector, legal experts, banking/financial institutions and academia while firming up recommendations. Infrastructure Development Finance Company (IDFC) will provide secretarial assistance to the Committee.

The Committee has been asked to submit its report within three months.

The government wants private companies to contribute half of a $1 trillion investment target over five years to 2017 to alleviate clogged-up roads and end electricity blackouts.

But various issues have caused delays and prompted banks to cut credit lines, leaving scores of projects in limbo and deterring new investment.

Narendra Modi came to power after cutting the number of approvals needed for road projects in Gujarat, making it easier for investors to build dozens of new highways. He also restructured utilities to make Gujarat India’s only state with almost universal 24 hour electricity.

Road-building is particularly prone to PPP weaknesses. At least 600 billion rupees ($10 billion) worth of projects is unfinished, primarily because of difficulty obtaining the required land to lay, lengthen or widen roads.

However, the infrastructure investment target for 2017 is going to be missed.

Comments

 

Other News

Stories to read over the weekend

At one time these pale rooms of the Delhi commission for women looked like sleepy corners of officialdom; they are now best described as a bustling sarkari office. The woman who transformed this moribund organisation hardly looks like a powerful leader. Dressed in casual blue jeans and loose deni

Tata Trusts, PFA to build state-of-the-art veterinary hospital

Tata Trusts and People For Animals (PFA) announced their collaboration to build a state-of-the-art, multi-specialty veterinary hospital and emergency clinic at Navi Mumbai to serve the needs of all domestic and farm animals at affordable rates.   The hospital will be built in Kala

The shot just got smarter

A long queue of women, infants in their arms, extends outside the immunisation room at the community health centre (CHC) in Bhangel village, Noida, a pink double-storey building beside a bustling market. Unmindful of the chit-chatting and baby babble, Mariamma Samuel, an auxiliary nurse-cum-midwi

Do you think fugitive industrialist Vijay Mallya will be extradited from Britain to India?

Do you think fugitive industrialist Vijay Mallya will be extradited from Britain to India?

Reform first, privatise later: Bibek Debroy to railways

Before privatisation and corporatisation, the Indian Railways need to undertake major reforms including commercial accounting, decentralisation and human resource among others, said Bibek Debroy, economist and member, NITI Aayog at Railways Reforms and Governance Conclave organised by Governance Now on Fri

NTPC plans for 32 GW installed capacity via renewable sources

NTPC Ltd has raised Rs 2,000 crore through green masala bonds in overseas market under its $4 billion medium term note programme, union minister Piyush Goyal informed the Lok Sabha. The proceeds of these bonds will be used for financing renewable energy projects in accordance with applicable

Video

हमेशा रहें चुनाव के लिए तैयार - मोदी ने कहा सांसदों से

Current Issue

Opinion

Facebook    Twitter    Google Plus    Linkedin    Subscribe Newsletter

Twitter