PUBLIC-PRIVATE PARTNERSHIP (PPP) MODEL

INTRODUCTION: 

SPEECH BY PROMINENT PERSONALITIES (PM, PRESIDENT, UN OFFICIAL et. al)/RECOGNITION IF ANY:

• Public-Private Partnership is not just about investments, but about a collaborative effort for holistic development and progress: PM Modi
• Public-Private Partnership can be a powerful instrument for economic growth and development, leveraging the strengths of both sectors for the greater good: Fmr. PM Manmohan Singh
• "Public-Private Partnership is a dynamic collaboration that fosters innovation, investment, and shared progress, driving our nation towards sustainable development." – Ex-VP M. Venkaiah Naidu

CURRENT DEVELOPMENT: 

• The Finance Ministry has notified India Infrastructure Project Development Fund Scheme (IIPDF Scheme) for the financial support of project development expenses of PPP projects.
• Govt’s infrastructure lender NaBFID recently partnered with IFC (World Bank) for funding PPP projects in infra sector.
• As per National Monetisation pipeline, 25 airports have been listed for leasing over years 2022-2025. 

DATA/FACT:

KEYWORDS:

• BODY: Shared Accountability Model; Development Through Alliance; Crony Capitalism; Model Concession Agreement
• CONCLUSION: From ‘Political Disconnect’ to ‘Partners in Progress’; PPPP (Public Private People Partnership);

COMMITTEES RECOMMENDATIONS/NATIONAL OR INTERNATIONAL REPORTS:

• Vijay Kelkar Committee: Frame National PPP Policy & Law, PPP Contracts to focus on service delivery and not on fiscal benefits; Viability Gap Funding Mechanism needs to be prudently utilized; Develop Sector-specific institutional framework and Umbrella Guidelines for stressed projects; Setup PPP Adjudication Tribunal (“IPAT”); Discourage Swiss Challenge Method as it hiders transparency; Setup Institute of Excellence in PPP
• Public Private Partnership Appraisal Committee recommended project viability, risk assessment, and optimal allocation of resources, ensuring effective collaboration for development initiatives.

GOVT SCHEMES, POLICIES AND INITIATIVE:

• Public Private Partnership Appraisal Committee (PPPAC): apex body for appraisal of PPP projects in the Central Sector

• Viability Gap Funding Scheme limit raised to 30% for social sector infrastructure projects
• Support to various PPP models: Build-Operate-Transfer (BOT), Design-Build-Finance Operate-Transfer (DBFOT), Rehabilitate-Operate-Transfer (ROT), Hybrid Annuity Model (HAM), and Toll-Operate-Transfer (TOT) model,

EXAMPLES/CASE STUDIES:

National

• PPP transformed Delhi Airport into an efficient, modern hub. GMR Group partnered with Airports Authority.
• Mumbai's first metro thrived via PPP: Reliance, Mumbai Metro Authority partnership vitalized city's transportation.

International

• Channel Tunnel: UK-France landmark PPP by Eurotunnel. Designed, built, operates vital rail link.
• Istanbul New Airport: Massive PPP project, Turkish government, and private consortium collaboration.

CONCLUSION

• Private investment needs be encouraged in infrastructure through a renewed public-private partnership (PPP) mechanism on the lines suggested by the Kelkar Committee to transform ‘reforms to results’.
• PPPs are the ‘future of developing nations’ like India, thus, transparently defining the rules, earning the trust and engaging in effective implementation of PPP projects are critical to give a strategic push to India’s economic growth.

PRINCIPLES OF EFFECTIVE TAXATION