Industry Odisha Bureau, Jun 5: In a bid to allow large financial investors (FIs) to have direct and early access to participate in developing greenfield projects across the country, the Government of India (GoI) is reportedly mulling on a new ‘public-private-partnership’ (PPP) framework.
Sources reported that, “the new PPP framework, once ready and duly approved, would allow the private equity (PE) firms, pension funds, sovereign wealth funds and large financial investors to directly take part in developing greenfield infrastructure projects like power, railways, airports, urban infrastructure, water supply, et al, apart from the highway projects.”
In this context, sources explained that “the existing PPP model allowed FIs to enter only after the projects started operating, while the goal of the new PPP model would be to expand the pool of long-term capital available for infrastructure creation.”
Thus, the Department of Economic Affairs in the Ministry of Finance has reportedly deliberated on the new PPP model plan with other ministries of the Union Government focused on infrastructure developments, sources said.
Sources further revealed that “direct participation of PEs and large FIs in greenfiled projects has till date remained limited due to lack of execution experience, financing and demand risks, while the new PPP model would allow large FIs to directly bid for those projects despite sans prior construction experience provided that they duly meet the eligibility of satisfyingly having technical and engineering criteria.”
