New PPP models will give a boost to infrastructure projects

Ayan Pramanik Kolkata | Updated on March 12, 2018 Published on August 02, 2013

The models have become attractive; one of them includes provisions for uncapped revenue for the contractor — Manoj Singh, Advisor – Transport, Planning Commission.

Infrastructure development through public-private partnership (PPP) route has not been very successful with a large number of road and rail projects remaining incomplete. In an interview to Business Line, Manoj Singh, Advisor-Transport, Planning Commission, claims efforts are being made to remove deterrents.


Are PPP models turning out to be unviable for infrastructure development projects?

Last year, road projects undertaken on the build, operate and transfer route failed to take off as expected. Against a target of 8,000 km, less than 2,000 km was ordered. But, the model is not unviable. Probably, there is a problem due to the global economic situation. Also, there are concerns pertaining to getting clearances. Some of the high profile cases of withdrawal from projects might have also deterred the industry a bit.

But, the Government recently took a lot of steps to address these issues. For example, road projects have been brought outside the ambit of the Indian Forest Act, 1927, following a Supreme Court order. Also, construction companies are now allowed to exit the project.

Earlier, there was a two-year moratorium. So, the Government is trying to revive the entire system.

You talked about changes in PPP models. Can you elaborate?

Six new PPP models have been drawn out. They have become very attractive. One of the new models includes provisions for uncapped revenue for the contractor. Another model has a clause for segregating earnings (between passenger vehicles and goods carriers) of the operator. A revised model will also allow a private company or port to fund for their own (road or rail) connectivity.

Have private companies shied away because of delay in clearances?

Yes, delayed clearances have deterred companies. There were difficulties in attaining regulatory clearances. And, it’s right to recognise that. The Ministry of Road Transport and Highways now plays an active role in dealing with such issues. In fact, under the Cabinet Secretary, a forum has been set up and all high-value projects are being monitored by it.

Are Railway projects also being affected ?

There were not many PPP projects for developing rail infrastructure. But, the bigger problem is under-funding. One example of delay in clearing rail projects is the Tori-Shibpur-Hazaribagh coal connectivity under the East Central Railway. It was delayed by almost six to seven years for want of forest clearances. Of late, it received the Stage II clearance for the track from Tori to Shibpur.

Is transportation through inland waterway going to curtail the burden on the saturated rail connectivity?

It will definitely reduce the pressure on Railways. Apart from coal, talks are on to transport other commodities such as fertiliser, food grain and tea along the National Waterway 2 (section of the Brahmaputra river covering a 891 km stretch between Bangladesh border and Sadiya in Assam). ayan.pramanik@thehindu.co.in

Published on August 02, 2013
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