Public Private Partnership- Public Private Partnership- Identification, Viability and Identification, Viability and

ImplementationImplementation

Prof. Yashvir TyagiProf. Yashvir Tyagi Department of EconomicsDepartment of Economics

Univesity of Lucknow Univesity of Lucknow

Public Private PartnershipPublic Private Partnership

Need For PPPNeed For PPP

Objective of PPPObjective of PPP

Nature of PPPNature of PPP

Scope of PPPScope of PPP

Definition of PPPDefinition of PPP

“ “PPP means a project based on PPP means a project based on contract or concession agreement contract or concession agreement between the govt. or a statutory between the govt. or a statutory entity on the one side and a private entity on the one side and a private sector company on the other side for sector company on the other side for delivering an infrastructure service delivering an infrastructure service on payment of user charges” on payment of user charges” (G.O.I.)(G.O.I.)

PPPPPP It is a-It is a- Long term contractual partnership Long term contractual partnership

between public & private agencies between public & private agencies for:for:DesigningDesigningFinancingFinancingImplementingImplementingOperating & managing an Operating & managing an infrastructural serviceinfrastructural service

PPPPPP

Collaboration or partnership is Collaboration or partnership is based on the expertise of each based on the expertise of each partner through appropriate partner through appropriate allocation of:allocation of:

. Resources. Resources

. Risks. Risks

. Rewards . Rewards

. Responsibilities. Responsibilities

Identification Of ProjectsIdentification Of Projects

Assessment of the need for Assessment of the need for existing /new serviceexisting /new service

Review of present status of delivery Review of present status of delivery of serviceof service

Identifying the gapIdentifying the gap

SWOT analysis may be conductedSWOT analysis may be conducted

Potential Areas of PPPPotential Areas of PPP RoadsRoadsTelecommunicationTelecommunicationTransportTransportHealthHealthEducationEducation IrrigationIrrigationMarketingMarketingEnergyEnergySocial WelfareSocial Welfare

Preparing for the Viability of a PPP Preparing for the Viability of a PPP ProjectProject

General Aspects:General Aspects:

Name of the ProjectName of the Project

LocationLocation

Administrative Department/MinistryAdministrative Department/Ministry

Implementing AgencyImplementing Agency

Project DescriptionProject Description

Aims and Objectives, JustificationAims and Objectives, Justification

Possible AlternativesPossible Alternatives

Estimated Capital costEstimated Capital cost

Major heads of ExpenditureMajor heads of Expenditure

Phasing of InvestmentPhasing of Investment

Implementation ScheduleImplementation Schedule

Financing ArrangementsFinancing Arrangements

Sources of Financing-Debt , Equity, Sources of Financing-Debt , Equity, Grants etc.Grants etc.

Fixation of Tariff/user chargesFixation of Tariff/user charges

Indicate Revenue streams of the Indicate Revenue streams of the projectproject

Calculating the NPV, ERR,IRRCalculating the NPV, ERR,IRR

Funding Agencies- Domestic , Funding Agencies- Domestic , ForeignForeign

Clearances from Regulatory BodiesClearances from Regulatory Bodies

EnvironmentalEnvironmental

ForestForest

Local, State, Central Govt.Local, State, Central Govt.

Govt. GuaranteesGovt. Guarantees

Compensation to CitizensCompensation to Citizens

Criteria for Short listingCriteria for Short listing

One stage processOne stage process Two stage processTwo stage processCriteria for Evaluating the BidsCriteria for Evaluating the BidsPreparing the bid documentsPreparing the bid documents LegalLegal TechnicalTechnical AdministrativeAdministrative

ClearancesClearances

Terms of Concession AgreementTerms of Concession Agreement

Nature of ConcessionNature of Concession

Justification of ConcessionJustification of Concession

Period of ConcessionPeriod of Concession

Period of ConstructionPeriod of Construction

Procurement of MaterialsProcurement of Materials

SupervisionSupervision

Operation & ManagementOperation & ManagementMonitoring the ConstructionMonitoring the ConstructionJoint or Single management- Roles& Joint or Single management- Roles& responsibilitiesresponsibilities Laying down the StandardsLaying down the Standards Penalties for ViolationsPenalties for Violations DelaysDelays SafetySafety FinancialFinancial Liabilities of the PartnersLiabilities of the Partners Closure ClauseClosure Clause

MiscellaneousMiscellaneous

AuditAudit

Dispute SetllementDispute Setllement