Infrastructure projects pose a huge a challenge because of their long-gestation nature, and also due to involvement of multiple stakeholders at different layers. For a variety of reasons, they are held up mid-way. This has been a major problem area for the economy. The budget has sought to address these concerns.
“Private sector plays an important role in the development of infrastructure, many of which are implemented in the Public-Private Partnership (PPP) mode,” the Finance Minister said. The Budget has introduced three new initiatives to reinvigorate this sector. They are as follows:
1. Introduction of A Public Utility (Resolution of Disputes) Bill to streamline institutional arrangements for resolution of disputes in infrastructure-related construction contracts, PPP and public utility contracts.
2. New guidelines for renegotiation of PPP concession agreements. These will take into consideration the long-term nature of such contracts and potential uncertainties of the real economy, without compromising transparency.
3. Introduction of a new credit rating system for infrastructure projects, which will give emphasis to various in-built credit enhancement structures.
