Infratweets: PPP on a new low

By: | Updated: June 22, 2016 8:05 AM

World Bank ~ India hit a decadic low in PPP in 2015. Still, of d 43 deals in South Asia—36 were from India. 26 of this 36 in Renewables.

InfratweetsAccording to the World Bank, “India recorded a 10-year low in investments, as only six road projects—usually a rich source of PPI over the past 10 years—reached financial closure.” However, India continued to generate a majority of the projects in the South Asia region.

Tweet: World Bank ~ India hit a decadic low in PPP in 2015. Still, of d 43 deals in South Asia—36 were from India. 26 of this 36 in Renewables.

PPP investment hits a 10-year low

According to the World Bank, “India recorded a 10-year low in investments, as only six road projects—usually a rich source of PPI over the past 10 years—reached financial closure.” However, India continued to generate a majority of the projects in the South Asia region.

Tweet: 2 keys to unlock India’s economic potential. (1) GST (2) ‘One nation, one grid, one price’ ~ a seamless national mkt for electricity.

Key factors in economic revival

Increasingly, there is a convergence of opinion in industry and political circles that along with the uniform tax rate, India would do well to craft a national market for electricity.

Tweet: Airport Regulator wants functional airports—not “gold plated” ones. Agree. What about strictures on poorly built & maintained airports?

AERA calls for curbs on capital costs

The Airports Economic Regulatory Authority (AERA) has released a tentative ceiling on capital costs incurred by airport operators. The idea is to put in place a “reasonable benchmark” for determining the fee charged from users and curb possible ‘gold plating’ of expenses.

Tweet: RBI’s S4A: Bad loans estimated upwards of R6 lac crores. Even if 15% converted to equity, well that’s about R1 lac cr worth of new shares!

RBI’s relief for distressed banks

The Reserve Bank of India will now allow banks to convert up to half the stressed loans held by corporate borrowers into equity or equity-like securities. The move is aimed at restoring credit flow to sectors such as infrastructure and steel.

Tweet: Rlys buying power directly from Dabhol. Now Delhi Metro to buy green power from MP. Heartening to see creeping progress of Open Access.

A new model of power sourcing

Indian Railways and Delhi Metro are part of a growing movement to acquire power from outside sources, away from discoms in places where they are located. In many ways, this marks a welcome shift by institutional buyers towards a maturing open access regime.

Tweet: Maharashtra Discom’s shabby treatment to wind power developers getting to be extremely embarrassing for a Central Govt pushing Renewables.

Knocking the wind out of renewables’ sails

Wind energy developers in Maharashtra have alleged that the state power distribution utility owes them more than R1,000 crore. Many projects are on the brink of a collapse as the discom stopped making payments in October last year.

Tweet: Clear warning on misuse of central funds. @PiyushGoyal warns states of stoppage of urban+rural elec network funding if anomalies observed.

Goyal talks tough

Power minister Piyush Goyal has warned that he will pull the funding plug to states if any irregularities are found in the implementation of flagship schemes for rural electrification and urban upgradation of power infrastructure. Problems related to quality, technology, pricing or corruption would further be put up on the ministry’s website.

Tweet: Popular to have roadshows & investor meets in NY, London, Sing, Dubai, HK. But it is Canadian investors who are mopping up road assets!

Highway to investment

PSP Investments is the latest Canadian pension fund to invest in the Indian highways sector. The other fund that has been investing heavily is the Canada Pension Plan Investment Board. It had announced it would invest R2,000 crore in Larsen and Toubro Ltd subsidiary L&T IDPL, which owns 17 road assets. Brookfield of Canada has also been picking up infrastructure assets.

—Vinayak Chatterjee is Chairman of Feedback Infra
His Twitter handle: @Infra_VinayakCh
A weekly selection of the author’s tweets—
with a brief backgrounder—in the infra space, by Adite Banerjie

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