Infrastructure development through PPPs in India: criteria for sustainability assessmentby Nilesh A. Patil, Dolla Tharun, Boeing Laishram

Journal of Environmental Planning and Management

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Infrastructure development through

PPPs in India: criteria for sustainability assessment

Nilesh A. Patila, Dolla Tharuna & Boeing Laishrama a Infrastructure Engineering and Management Division,

Department of Civil Engineering, Indian Institute of Technology

Guwahati, Guwahati, India

Published online: 10 Jun 2015.

To cite this article: Nilesh A. Patil, Dolla Tharun & Boeing Laishram (2015): Infrastructure development through PPPs in India: criteria for sustainability assessment, Journal of Environmental

Planning and Management, DOI: 10.1080/09640568.2015.1038337

To link to this article: http://dx.doi.org/10.1080/09640568.2015.1038337

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D ow nl oa de d by [N ew

Y or k U niv ers ity ] a t 0 4:3 7 1 8 J un e 2 01 5

Infrastructure development through PPPs in India: criteria for sustainability assessment

Nilesh A. Patil, Dolla Tharun and Boeing Laishram*

Infrastructure Engineering and Management Division, Department of Civil Engineering,

Indian Institute of Technology Guwahati, Guwahati, India (Received 17 August 2014; final version received 12 March 2015)

Public private partnerships (PPPs) allow the Indian Government to leverage private capital for meeting the widening demand-supply gap in the provision of infrastructure services. The private sector, however, prefers to limit the participation to financially attractive projects only, thereby resulting in patterns of infrastructure creation impeding the progress towards sustainable development. In order to promote sustainable development, the PPP procurement process should focus on incentivising the private sector for sustainable infrastructure development rather than concentrating on ensuring financial sustainability only. This paper discusses the principles-based

PPP-specific framework that has been developed to facilitate assessment of PPP projects’ progress towards sustainable development. The framework development was based on a holistic approach to sustainability assessment and subsequently validated through questionnaire survey with key stakeholders in the Indian PPP programme.

This framework will provide the decision makers with appropriate decision aid for integration of sustainable development principles in the PPP procurement process.

Keywords: public private partnerships (PPPs); sustainable development; infrastructure development; sustainability assessment; procurement process 1. Introduction

Public private partnerships (PPPs) have been adopted as one of the preferred routes for the development of infrastructure projects in India since the economic liberalisation initiated in the1990s (Ministry of Finance 2014). In the 11th Five Year Plan, the total investment in infrastructure was INR 2,424,277 crore (US$ 404 billion @ INR 60/US$), wherein the private sector contributed about 36% through the PPP route (Planning

Commission 2013b). The Indian governments have adopted a strategy to increase the share of private investment in infrastructure development through various forms of PPP in the 12th Five Year Plan (Planning Commission 2011). As per the 12th Five Year Plan, 20122017, the required investments in infrastructure have been forecasted to be INR 5,574,663 crore (US$ 929 billion @ INR 60/US$) (Planning Commission 2013b). The

Central Government has envisaged 50% of the required investment in infrastructure from the private sector through the PPP route.

PPPs have enabled Indian governments to ease budgetary constraints and bridge the infrastructure demand-supply gap (Planning Commission 2010). Infrastructure sectors such as national highways, ports, airports, power, and urban infrastructure have attracted private sector investments through PPPs in India (Planning Commission 2013a). This has *Corresponding author. Email: boeing@iitg.ernet.in  2015 University of Newcastle upon Tyne

Journal of Environmental Planning and Management, 2015 http://dx.doi.org/10.1080/09640568.2015.1038337

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Y or k U niv ers ity ] a t 0 4:3 7 1 8 J un e 2 01 5 resulted in additional capacity and delivery of quality public services, but investments have been confined to providing infrastructure services in high value locations, while the less profitable regions, such as North East regions, and project types, such as water and wastewater and other social sectors, have failed to attract enough private sector participation (Planning Commission 2008). Public sector unions have often resisted