An American company is set to bag a Rs 30,000-crore project to build locomotives for the Indian Railways, a much-delayed mega-deal that is likely to be catalysed by the visit of President Barack Obama next month. The U.S. President visit is also expected to see the signing of the largest ever defence agreement between India and the US. The company will build 1,000 mainline diesel electric locos — engines in which diesel is the prime mover — over 10 years, and provide maintenance support over a period of time in a public-private partnership with Indian Railways, with the latter holding 26% stake.
Taking serious cognizance of the deteriorating standard of school education, the Maharashtra government has drafted an ambitious public-private partnership plan to set up a network of English-medium "model schools'' providing "world-class education'' across the state.
The Planning Commission has acknowledged to state governments that funds provided under plan schemes are “inadequate” for achieving the goal of universalising school education. To help the government meet this goal, the commission is reaching out to the states to put in place a public-private partnership scheme for schools.
The most significant criteria for a continued growth rate of an economy rest on the provision of a quality infrastructure. According to the Planning Commission, an approximation of 8 percent of the Gross Domestic Product or GDP needs to be invested. This would help in acquiring a prospective economy as stated in the 11th Five Year Plan. Fund investment of over US $ 494 billion has been conceived of according to the 11th Five Year Plan with effective from 2007 to 2012. The investment sectors under consideration are inclusive of telecommunications, electric power, water transport, road, rail, air, water supply as well as irrigation amounts to about Rs. 20,27,169 crore according to 2006-07 prices.
In order to meet such demands, various Public Private Partnerships or PPPs are being promoted for implementation of infrastructure projects. Several initiatives have been undertaken by Government of India to enable a greater PPP framework.
What is PPP:
Public-private partnership (PPP) describes a government service or private business venture which is funded and operated through a partnership of government and one or more private sector companies. These schemes are sometimes referred to as PPP. Thus, PPP involves a contract between a public sector authority and a private party, in which the private party provides a public service or project and assumes substantial financial, technical and operational risk in the project.
Definition of PPPs in India:
“PPP means an arrangement between a government or statutory entity or government owned entity on one side and a private sector entity on the other, for the provision of public assets and/ or related services for public benefit, through investments being made by and/or management undertaken by the private sector entity for a specified time period, where there is a substantial risk sharing with the private sector and the private sector receives performance linked payments that conform (or are benchmarked) to specified, pre-determined and measurable performance standards”.
Essential conditions in the definition:
— Approach Paper to the Eleventh Plan
— Dr. Montek Singh Ahluwalia,
Deputy Chairman, Planning Commission, Government of India
- Prof. M. Guruprasad
AICAR Business School