The Hindu Business Line : Infrastructure projects: Montek for viable public-pvt partnerships

THE Planning Commission Deputy Chairman, Mr Montek Singh Ahluwalia, advocated spending of the scarce public resources on building infrastructure, health and education in rural areas, while scouting for private investments in a variety of infrastructure projects elsewhere.

He, however, said that the public-private partnership was no mantra. "But it is a useful vehicle." To attract private participation, there was a need to evolve a viable revenue model (like the one in telecom sector), reasonable rates monitored by a matured regulator, contract enforcement and dispute resolution mechanism.

Investments down: Delivering the foundation lecture at ASCI (Administrative Staff College of India) on `Infrastructure development - problems and prospects' here on Tuesday, Mr Ahluwalia said investments in infrastructure in the last 10 years had declined steadily. From 5.5-6per cent (of the Gross Domestic Product) during 1985-95, investments in the sector had fallen to 3.6 per cent in 2002-03. The country needed to increase the figure to at least by three percentage points, meaning an investment of Rs 1,00,000 crore every year, he said.

He was referring to the `non-tradable infrastructure' areas such as roads, railways, ports, power, telecom and basic amenities.

Telecom largely on target: Evaluating the performance of various sectors, Mr Ahluwalia said the Mid-Term Appraisal had shown that only the telecommunications sector had been able to achieve the targets, barring the lags in the village connectivity. The country lost some Rs 40,000 crore in the power sector and spent Rs 20,000 crore on oil subsidies. The road sector had shown that it was possible to attract private investment in this area. The Government was working on various models. Mr Ahluwalia said that the Railways was one sector with constraints in attracting private investments. He felt that there was a scope for private investments in the container business.

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