PPP in India

The Concept of PPP in India

A public-private partnership (PPP) involves the private sector in aspects of the provision of infrastructure assets or of new or existing infrastructure services that have traditionally been provided by the government.

While there is no single definition of PPPs, they broadly refer to long-term, contractual partnerships between the public and private sector agencies, specifically targeted towards financing, designing, implementing, and operating infrastructure facilities and services that were traditionally provided by the public sector.

Public Private Partnership (PPP) Project means a project based on a contract or concession agreement, between a Government or statutory entity on the one side and a private sector company on the other side, for delivering an infrastructure service on payment of user charges.

Government of India definition of PPP

Various advantages associated with PPP approach:

  • The emergence of Public-Private Partnerships (PPPs) is seen as a sustainable financing and institutional mechanism with the potential of bridging the infrastructure gap.
  • Apart from enabling private investment flows, PPPs also deliver efficiency gains and enhanced impact of the investments.
  • The efficient use of resources, availability of modern technology, better project design and implementation, and improved operations combine to deliver efficiency and effectiveness gains which are not readily produced in a public sector project.
  • PPP projects also lead to faster implementation, reduced lifecycle costs, and optimal risk allocation.
  • Private management also increases accountability and incentivizes performance and maintenance of required service standards.
  • Finally, PPPs result in improved delivery of public services and promote public sector reforms.

Various models of PPP in India:

ppp-models in India

As of November 2020, 1,103 PPP projects were launched in the country, representing a total of $274,959,000,000 of committed investments

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