PPP: Is it the New Entrepreneurial Way?

The day has arrived when on Tuesday,8thJuly,2014 Union minister Sadananda Gowda presented his first Rail Budget in Lok Sabha followed by the annual budget on Thursday,10th July,2014 by the Finance Minister Arun Jaitley .Glued to the TV sets, each one of us were wondering whether these propositions the same old wine packed in new bottles or NaMo has something different stored for the masses. Amidst everything what catches us the most are the following (by the TOI):
• Development of metro rails in PPP mode
• Funds for the proposed first Indian bullet train network through FDI and PPP
• FM: There is need to develop more sophisticated models with quick redressal mechanism in PPP contract.
• India has emerged as the largest PPP market in world.
• New airports to be developed through PPP mode.
• In order to complete gas grid, 15000km of additional pipeline to be developed through PPP mode.
• World class convention facility to be developed through PPP mode.

What is common among all the bulletin is PPP mode. Is it the new entrepreneurial way?
PPP( Public Private Partnership) means an arrangement between a government / statutory entity / government owned entity on one side and a private sector entity on the other, for the provision of public assets and/or public services, through investments being made and/or management being undertaken by the private sector entity, for a specified period of time, where there is well defined allocation of risk between the private sector and the public entity and the private entity receives performance linked payments that conform (or are benchmarked) to specified and pre-determined performance standards, measurable by the public entity or its representative.
Gov. >> Business>> Infrastructure>> Funds/Capital>>Private players.
The flow chart is self-explanatory where government intends to cultivate a business culture which needs infrastructure to be built up with the joint efforts of private entrepreneurs and government to overcome the constraint of funds.It will act as a catalyst whereby projects will not merely get sanctioned but will be completed on time. It will result in dual benefits-
*Private individuals will get their best possible return as per MoU & increase their clientele.
*Govt will achieve its motto of public service with optimum & effective utilization of resources.

Expressways, Newly built T-2 ,IGI airport, Mumbai metro (J.V. with Reliance Infrastructure Ltd.) etc are the best examples to understand its working and undoubtedly it will bring home multitudes of entrepreneurial opportunities ranging from a small food court to big corporate houses. Once the infrastructure is set, everything else comprising jobs, business, development will fall in place. For this even we need to change our perception.

Let’s say when at the toll plaza ,a car is being stopped for collection ,apparently an ordinary man believes that he is being charged for everything he uses in India but he does not see that it has benefited him otherwise in the form of better roads which in turn speed him up, less exertion & reduce his maintenance cost .

However, just like every coin has two sides, there are always apprehensions if this PPP (public private partnership) turns out to be solely PPP(private private private) and do away with its very purpose of public good. Although the era of initiatives has started, we are yet to see what turn the road takes with time and watchout for the probable uphills and blind curves in the way.

Written by: Himanshi Ajmera (SRCC Student & E-Cell’s Campus Ambassador)