Public-private partnership (PPP) is an effective tool for bringing private sector efficiencies in creation of economic and social infrastructure assets and for delivery of quality public services. The extent of private sector participation in creation of infrastructure, especially through PPP, has shown a promising increase in recent years.
As of January 2012, there were 881 PPP projects with a total project cost (TPC) of R543,045 crore as compared to over 700 projects with TPC of R371,239 crore by March 2011. These projects are at different stages of implementation i.e. under bidding, construction and operational stages. The broad sectors encouraged under the PPP framework are highways, railways, ports, airports, power and urban infrastructure.
The appraisal mechanism for the PPP projects has been streamlined to ensure speedy appraisal of projects, eliminate delays, adopt international best practices and have uniformity in the appraisal mechanism and guidelines. The appraisal mechanism notified includes setting up of the Public-Private Partnership Appraisal Committee (PPPAC) responsible for the appraisal of PPP projects in the central sector. Since its constitution in January 2006, the PPPAC has granted approval to 223 projects, with a total project cost of R212,819.50 crore.
Standardised bidding and contractual documents have been notified. These include model request for qualification (RFQ); request for proposal (RFP) and RFP for technical consultants; Model concession agreements (MCAs) for different sectors, including highways (both national and state highways), ports, urban transport (Metro) and power sectors, and the 'manuals of standards & specifications' have been developed and standardised.
Further, project sponsors are encouraged to take up projects through a transparent, open competitive bidding process, which leads to greater transparency and consistency to the bid process and terms of contract.
The maximum number of PPP projects have been undertaken in the road sector with 447 projects, constituting 51.6% of the total projects. This was followed by the urban development sector with 177 projects (22.4%), energy with 77 projects (8.9%), ports with 62 projects (7.2%) and tourism with 55 projects (6.4%). In all, 225 projects have been completed whereas 410 are under various stages of construction and 184 under the bidding stage and the remaining in other various stages.
State-wise, Karnataka had the maximum of 105 projects with a total cost of R44,459.85 crore under PPP, followed by Andhra Pradesh with 98 projects at a project cost of R67,696.31 crore, Madhya Pradesh, 86 projects (R14,928.7 crore), Maharashtra, 76 projects (R45,916.34 crore), Gujarat, 72 projects (R45,315.02 crore), Rajasthan, 65