NEW DELHI: In a move that will revive the languishing public private partnership (PPP) projects in the country, Planning Commission
will come up with a Cabinet note next month, clarifying the existing
PPP framework. This would include clarity on approvals needed for such
projects, the scope of renegotiation in such projects and the available
exit option for developers of these projects.

Revival of PPP
projects in the country has become extremely essential after several big
players withdrew from such projects this year, citing lack of clarity
in the model concession agreements. This had happened at a time when
government is expecting at least 50% investment of the $1 trillion
estimated for infrastructure development in the country from private
players during the 12th five year plan (2012-17 ).

This year GMR and GVK had walked out of mega-highway projects, collectively worth Rs 10,700 crore, with the National Highway Authority of India while most recently Reliance Infrastructure had pulled out of the Rs 5,800 crore Airport Express Line of the Delhi Metro.

Besides, there are problems brewing up at the Gurgaon Expressway while the big ultra mega power projects in the country by Tata PowerBSE -1.78 % and Reliance PowerBSE 3.03 %
are struggling to transform their imported coalbased projects into
profit-making ventures on account of changes in input costs. Hence, to
arrive at a consensus with stakeholders, Planning Commission Deputy
Chairman Montek Singh Ahluwalia, on Friday, held a meeting with secretaries of infrastructure ministries to discuss the note on PPP projects.

“This was a first review meeting about PPP projects. Prime Minister has
asked planning commission to come up with an assessment of PPP
programmes, problems associated with them and suggestions to address
these issues,” Ahluwalia told reporters after the meeting. “We had a
draft paper which was discussed with all secretaries. This will now be
revised to incorporate their views after which we will discuss it with
finance ministry before going to Cabinet,” he added.

The meeting was attended by economic affairs secretary Arvind Mayaram and road transport and highways secretary Vijay Chhibber
along with representatives power, coal, civil aviation and urban
development ministry. Though private sector participation in
infrastructure projects has grown substantially from 10% in the 10th
Plan period to 37% during the 11th plan period, government feels it will
be difficult to attract the estimated 50% of the $1trillion investment
in infrastructure in the country during the 12th plan period from
private players unless these issues are resolved.