“Nothing Ventured, Nothing Gained”: Successful strategies adopted by Indian states for Public Private Partnerships

It is generally recognized that the lack of infrastructure is one of the major constraints on India’s ability to achieve 9 to 10% growth in GDP., To achieve this a total investment of Rs.2,056,150 Crore ($514 billion) is required for ten infrastructure sectors over the next five year period. Government realizes that, this demand for investment cannot be met by government alone and private capital from both home and abroad has to be mobilized. It is in this context that PPPs are fast emerging as a way for India to grow. Although the Government of India has been encouraging private sector investment and participation in all sectors of infrastructure, and there has been considerable innovation in the design of PPPs, it is clear that the progress has been uneven. There are islands of progress, with some states having undertaken far more PPPs than others. There is considerable diversity in both the legal and institutional frameworks in place, and the level of transaction capacities and experiences. This paper propose to examine the effectiveness of policy and legal frameworks in place in selected states to identify the critical factors that determine investment inflows in to PPP projects in Indian states, so as to suggest most suitable/needed frameworks and capacities to be developed in states for PPP Programs.