Survey upbeat about success of PPP model for infrastructure growth

New Delhi, Feb 27 (UNI) With a sound policy framework in place, the Economic Survey 2006-07 exudes confidence that investments in the infrastructure sector will gather momentum, but much will depend on how the invesetment in this critical sector is funnelled and facilitated.

''The drumbeats of infrastructure will become gradually louder in the next few years, and their rumble will be felt and heard all over the country,'' says the survey, which was introduced in Parliament by Finance Minister P Chidambaram today.

Observing that the government has been actively pursuing Public Private Partnerships (PPPs) to bridge the infrastructure deficit in the country, the survey says several initiatives have been taken during the last three years to promote the PPP model in sectors like power, ports, highways, airports, tourism and urban infrastructure.

''The outlook for infrastructural improvement looks promising.

With experience gained in PPPs, formulation of model PPP and concession agreements, infrastructure investments should gain momentum over the coming months and year.'' However, the rosy scenario projected by it comes with a rider.

The PPP is still a nascent concept in the country and expertise at the level of projects authorities, both at the central and state levels, is limited. ''The awareness of concerns and issues relating to PPPs is still lacking and not evenly spread across the different states.'' To promote the PPP model, all state governments and Central Ministries have been advised to set up a PPP Cell with a senior level officer deputed as nodal officer. It is proposed to provide asistance to states in this regard.

The Asian Development Bank has extended technical assistance (TA) for overall capacity building in state governments for PPPs.

The survey says a database on PPP projects is also being developed and the task has been outsourced to a private firm that will be responsible for collection, compilation and maintenance of the database.

Listing further measures for streamlining the PPP business model, it says the PPP programme has been finalised under the overall guidance of the Committee of Infrastructure, headed by the Prime Minister.

''There exist strong, well-recognised linkages between infrtstructure on the one hand and economic growth and poverty alleviation on the other,'' points out the survey.

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