PPPs in Road Infrastructure: The Indian Experience

PPPs in Road Infrastructure: The Indian Experience

Manisha Verma (Government of India, India)
DOI: 10.4018/978-1-4666-7470-7.ch010
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Abstract

PPPs are based on the implicit premise that the market stands for better efficiencies than the government and partnership with the private sector will provide access to its more efficient technical and managerial resources in addition to its capital. They have also been claimed to cut down on time and cost over-runs. This chapter, which provides findings from PPPs in highways from India, reveals that PPPs have multiple problems in their implementation. What is significant is that the public partners are responsible for many of these problems, although the private developers have also contributed through their manipulation of contractual obligations, land grabbing, and under-reporting of traffic to make illegitimate profits. A more active role of the state in the governance of PPPs, so as to make them more effective modes of delivery of services, is suggested. The chapter also recommends introspection on the philosophy of “single-size-fits-all” solution to address the infrastructure ills within any country.
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2. Analysing The Growth Of Ppps

Public Private Partnerships are defined as a long-term cooperative and contractual institutional arrangement between the government and the private1 sector structured towards achieving a desired public goal. Within this partnership the State2 and non-State actors share the associated resources, costs, risks and profits while developing and provisioning public services. More specifically for the infrastructure sector, the government and private agencies pool their differentiated and specialised resources3 for planning, design, construction, operation and maintenance of the infrastructure and share risks, investments, benefits and responsibilities. Among its various types, the DBFO (Design, Build, Finance, Operate) or BOT (Built Operate Transfer) model is found to be widely preferred. The concession type model is most used where public partner transfers property or facilities to the private sector (for or without payment) for whole or part of contract and services are provided by private partner for a defined time period (ranging from 10 to 99 years), after which it is transferred to the public partner with or without payment of its depreciated value (Pierson & McBride, 1996).

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