PPP regime for the infrastructure sector to revive soon
Due to the slowdown, there was a lukewarm response in the public-private partnership (PPP) projects in the highway sector.The conventional EPC model (Engineering, procurement and construction) of road construction was not yielding the desired results;hence the government had to spend almost double the sum on highway construction in the two years to end by FY14.
The government spending on highway construction stood at about R11,000 crore in FY12, which increased to R14,590 crore in FY13 and further to R21,290 crore in FY14. This was as per the National Highways Authority of India (NHAI) data.
However as the government sector expenditure was increasing, there was a downward trend in the private sector expenditure. In FY12 the private sector expenditure was around R26,000 crore which went down to R19,887 crore in FY13 and moved up a bit to R21,155 crore in FY14.
Experts believe that there is a herculean task in front of the new government and that is to make the PPP segmentmore attractive and practical. On Monday, the NDA government promised a fast-track, investor-friendly PPP regime for the infrastructure sector. The experts are speculating that this move might give a boost to the otherwise tepid response of the PPPs.
Source- The Financial Express
investor-friendly PPP regime for infrastructure sectors, public-private partnership (PPP) projects slipped to R19887 crore in FY13, slowdown-induced tepid response to public-private partnership
