Reports indicate that infrastructure firms and lenders to the sector requested the government to set up an independent regulator to deal with uncertain events in the execution PPP projects.
Firms and lenders want the proposed regulator to have powers to make the current agreements of the Public Private Partnership (PPP) projects more flexible to deal with unexpected events. As an alternative, these organisations want the government to give such powers to the existing regulators in the industry.
Banks and infrastructure firms made this request when they recently met officials of the Prime Minister’s Office and Planning Commission Deputy Chairman Montek S Ahluwalia recently, reports indicate.
Industry players suggest that the proposed regulator’s decision should be full and final and only questions over application of law should be taken to court.
Companies argue that in a PPP project private players share undue amount of risks like increase in capital cost, operating & maintenance cost and financing cost.
When the economy was growing rapidly, the incongruities in risk allocation were not so obvious. Now that has changed and many of the problems are on infrastructure projects, industry players opine.
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