Critical Analysis Of Legal And Regulatory Framework Of PPP Projects In India


This paper refers to the Public-Private partnership projects in India & their legal, regulatory framework. Public-Private partnership is an approach adopted by the Indian government to intensify the economic value of infrastructure outputs and it encompasses a broad spectrum of public sector infrastructure. The study aims at reviewing the existing structure of the legal and regulatory framework of  PPP & the critical analysis of it. The paper also takes note of the role of the current Government in enhancing PPP projects in India. The paper studies key sectors in Public-Private Partnership Agreement in India & Principles for conducting the implementation of Public-Private Partnership. The paper gives some recommendations on how the PPP policy of India should look like. It also takes into account the PPP framework provisions of other countries such as Japan, Canada, and England. 


PPP, Public Sector, Private sector, Economic growth, Infrastructure, PPP models, Legal framework 


A Public-Private partnership is a collaboration between the government or statutory entity and a private entity. This contractual agreement is done to enhance the economy and economic infrastructures such as airports, highways, railways, etc by the private sector as earlier it is controlled by the public sector. The key feature of PPP is the transfer of provision of services from the government to the private sector along with the deliverance of high-quality and cost-effective services to consumers as well as the government. 

Reforms of 1990 under the Narasimha Rao Government aimed at faster & better economic growth. This initiated the process of liberalization in India and as a result, the role of government even transformed from provider to facilitator. PPP was initially in the form of privatization but it had many obstacles as large sunk costs associated with providing much economic infrastructure and its tendency to undervalue social infrastructure. There is no exact date or year which could be defined as the beginning of the Public-Private Partnership but it is even said that PPP began with the private sterling investments in Indian railroads in the latter half of the 1800s. Tracing back to the 1900s, Private makers and merchants developed a power sector in Kolkata under Calcutta Electric Supply Corporation. Even in Mumbai, Tata played a prominent role as he started Tata Hydroelectric Power Supply Company in 1911. After liberalization, the central government decided to allow private participation in the power sector. This opened the doors for independent power producers. The National Highways Act of 1956 was altered in 1995 to empower private entities’ support. PPP was initiated mainly as a means of obtaining private sector capital and management expertise for economic and infrastructural advancement in India. Financing a project through PPP may allow a project to get completed in less time or make it a possibility in the first place as private sector technology and innovation get combined with the public sector which provides the incentives for the project to be completed within time and budget. The investment by the Private entity is undertaken for a specific period. A unique and innovative method to involve the private sector in nation-building activity through joint enterprises without spreading the limited available resources too thin is characteristic of the Public-Private Partnership. This method has emerged as one of the latest and most successful instruments of public finance. The PPP model is increasingly adopted by both developed and developing countries in recent years. 

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Author: Sejal Dalvi has recently completed her BA in Political Science from Ramnarain Ruia Autonomous College, Mumbai. She is now pursuing her Master's in Public Policy from St.Xavier's College. Her research interests include Political thought, International relations and Urban governance.