There are three issues plaguing the infrastructure sector — unsure cash-flows, existing contracts not delivering even what is genuinely due, and a painfully slow decision-making process. This leaves Public Private Partnerships comatose.

It is well-recognised that the infrastructure sector runs on cash-flows, rather than on profit and loss. Many of the infra projects do not get even their genuine cash-inflows. Take the example of energy distribution. Many States have not paid their dues for 9-13 months and, unfortunately, in these times of tight credit, these businesses suffer enormously.

Therefore, the first suggestion is to let the Budget provide for an equivalent of a Central Bill Discounting Service, wherein the genuinely accepted bills are paid up to the extent of 90 per cent.

The Budget can move the game up the technological ladder by removing most manual touch points. Tolling can be fully automated, as has been in the vogue for over two decades in Dubai and Singapore as also in Europe. We also need to remember that most infrastructure players are common across sectors. Many road sector concessionaires are also investors in the power sector. With both these sectors down for the last few years now, the gloom is rather widespread.

We must also differentiate between the Ease of Entering Business and Ease of Doing Business. While starting new businesses has become easier and less cumbersome, continuing to carry on that business has actually become tougher. Most decision-making at the bureaucracy level has actually become slower, with many decisions being referred to larger committees.

Also, a tendency to use these occasions of providing these approvals to extinguish even the genuine claims, must be curbed. In the process the agility has actually been lost.

One only has to study the approval processes wherein some funds are acquiring operating assets from original developers. The Budget can bring in a lot of energy to the system, by putting many of these on the auto-route.

One has perhaps never seen so many fresh orders in the infra space and at the same time, such distress in the infra construction companies. While replacing PPP with the traditional EPC route might have been a compulsion some years ago, this can’t continue. PPP must be resurrected and in its fully glory.

The author is Chairman, Board of Growth and Development, Feedback Infra Pvt Ltd

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