In several economic infrastructure sectors, India enjoyed a strong track record of harnessing Public-Private Partnerships (PPPs). Private sector investments in infrastructure more than tripled from the 10th Plan Period (2002-07; INR 2 trillion) to the 11th Plan (2007-12; INR 7.3 trillion). Between these plan periods, private sector share in infra investments increased from 22% to 38%. For a considerable period of time, on the score of mobilizing infrastructure investments through private participation among developing countries, India ranked 1st in Energy and Transport sectors and 2nd in Telecom (behind Brazil).
This erstwhile success of India’s PPP program is attributable to well-crafted reform efforts by the government, and ably executed by the private sector, banks and other financial intermediaries. Following the economic liberalization initiated in the early 1990s, the government has created an enabling environment for private participation through several sector-specific and cross-sectoral initiatives, e.g., relaxing entry norms, tax concessions, independent regulation in telecom and power, mobilization of additional revenues through tolls and cess on fuel, establishment of a viability gap fund mechanism and India Infrastructure Financing Company Limited, etc. The financial intermediaries, too, quickly moved up on a steep learning curve to cater to this new and challenging mode of delivering infrastructure services. Private sector responded enthusiastically and seized these opportunities to develop their own capabilities and progressively build larger and complex projects. Today, private sector operators are serving more than 90% of the mobile phone users, owning ~40% of the power generation capacity, built and operating a substantive portion of arterial network of national highways, besides world-class airports in four metros and container handling facilities at many ports.
roads and highways
On the streets of Shimla, residents stare at a strange group of visitors. The group looks and acts different from other tourists to this hilly capital of India’s mountain state of Himachal Pradesh.
Not Indian, and definitely not the usual European retirees. Oh, and even stranger, the group starts taking photos of parking lots, trash cans, and the tiny alleys that snake up and down the city.
That was how a group of global experts in a gamut of urban matters appeared to the citizens of Shimla. It was the group’s first day in a town they had never seen, nor ever imagined they would visit.
But here they were - experts at solid waste management, urban parking, public transportation, IT and city planning - at the request of the government of Himachal Pradesh (HP). HP is renowned for its pleasant climes, verdant forests and snow-clad peaks that not only act as a carbon sink for India’s burgeoning economy but also serve as a source of five perennial rivers that sustain the lives of million in the teeming plains below.
The inspiration for the experts’ visit came from the highest levels of the state government. Dr. Shrikant Baldi, the state’s additional chief secretary, had visited Korea to attend a global green growth conference sponsored by the World Bank. There he saw the real-life application of strategies that his government needed to take their own green growth agenda forward.
In the dry, rugged landscape of Rajasthan, children faced a hot and dusty trek to school, families had a hard time reaching medical help, and farmers, most of whom rely on dairy farming for their livelihood, found it difficult to take their milk to market.
With the coming of the road, farmers earnings have increased, children can get a ride to school, and medical help is reachable more quickly. With the commute to town now being easier, city jobs are within reach, and families are receiving better marriage proposals for their sons and daughters.