Need to pursue PPP in urban services more actively: Centre

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New Delhi, Nov 11 (UNI) The government today said there is a need to pursue the public private partnership (PPP) route in the urban sector more actively.

Addressing a CII seminar, Urban Development Secretary M Ramachandran said, ''The reasons behind the slow pace of growth of PPPs in urban sector is that these projects are extremely complex and require involvement of multiple agencies...there is a perception that urban services such as water supply, solid waste management and sewerage are less attractive, and inadequacy of user charges to meet operating and maintenance expenses lead to such perceptions.'' Private investment will bridge the financing gap and add to the viability of the projects, he said emphasising the need for PPPs.

Regarding the role of urban local bodies (ULB) under Jawaharlal Nehry National Urban Renewal Mission (JNNURM), he said while some ULBs are slow to plan PPPs, there are a few that have taken a pro-active role in proposing projects on PPP model.

About 44 projects, involving solid waste management, bus rapid transport system, water supply and sewerage are approved under JNNURM for PPP model.

To encourage PPPs in urban sector, there is a well defined framework, he said, adding that the viability gap funding mechanism, and India Infrastructure Project Devleopment Fund are all designed to meet specific requirement of PPP projects.

However, any clear cut framework for regulation of PPP projects other than the concession agreement is absent.

''As multiple PPP projects are taken up in the urban areas, there will be an urgent need to evolve a regulatory framework that will deal with tariff setting and revisions, performance monitoring and adherence to service standards,'' he said.

PPPs have now been widely accepted as a model which can augment the government's infrastructure delivery capacity. A PPP project involves sharing risks, roles and responsibilities between different stakeholders such as the private contractor, government and community.

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