APUFIDC
APUFIDC

PPP

TELANGANA URBAN FINANCE AND INFRASTRUCTURE CORPORATION (TUFIDC)

Public Private Partnership (PPP) Projects initiated by TUFIDC

The Government of India recognizes that there is significant deficit in the availability of physical infrastructure across different Sectors and that this is hindering economic development. Provision of quality infrastructure is critical for the economy to attain a higher growth trajectory on a sustained basis. The development of infrastructure requires large investments that cannot be undertaken out of public financing alone, and that in order to attract private capital as well as the techno-managerial efficiencies associated with it, the Government is committed to promoting Public Private Partnerships (PPPs) in infrastructure development. In addition to leveraging public capital to attract private capital and undertaking a larger shelf of infrastructure projects, PPPs bring in the advantages of private sector expertise and cost reducing technologies as well as efficiencies in operation and maintenance.

 

Public Private Partnerships (PPPs)

The Government of India recognizes that there is significant deficit in the availability of physical infrastructure across different Sectors and that this is hindering economic development. Provision of quality infrastructure is critical for the economy to attain a higher growth trajectory on a sustained basis. The development of infrastructure requires large investments that cannot be undertaken out of public financing alone, and that in order to attract private capital as well as the techno-managerial efficiencies associated with it, the Government is committed to promoting Public Private Partnerships (PPPs) in infrastructure development. In addition to leveraging public capital to attract private capital and undertaking a larger shelf of infrastructure projects, PPPs bring in the advantages of private sector expertise and cost reducing technologies as well as efficiencies in operation and maintenance. Public Private Partnerships (PPPs) present the most suitable option of meeting these targets, not only in attracting private capital in creation of infrastructure but also in enhancing the standards of delivery of services through greater efficiency.

 

Some of the primary reasons for public agencies to enter into public-private partnerships include:

  • Accelerating the implementation of high priority projects by packaging and procuring services in new ways;

  • Turning to the private sector to provide specialized management capacity for large and complex programs;

  • Enabling the delivery of new technology developed by private entities;

  • Drawing on private sector expertise in accessing and organizing the widest range of private sector financial resources;

  • Encouraging private entrepreneurial development, ownership, and operation of highways and/or related assets; and

  • Allowing for the reduction in the size of the public agency and the substitution of private sector resources and personnel

 

Government of India Support (PPP Cell, DEA, GOI)

 

The Government of India will extend total Viability Gap Funding under this scheme which shall not exceed twenty percent of the Total Project Cost; provided that the Government or statutory entity that owns the project may, if it so decides, provide additional grants out of its budget, but not exceeding a further twenty percent of the Total Project Cost.

The “India Infrastructure Project Development Fund” (IIPDF), PPP Cell, DEA, GOI

 

The procurement costs of PPPs, and particularly the costs of Transaction Advisors, are significant and often pose a burden on the budget of the Sponsoring Authority. Department of Economic Affairs (DEA) has identified the IIPDF as a mechanism through which Sponsoring Authority will be able to source funding to cover a portion of the PPP transaction costs, thereby reducing the impact of costs related to procurement on their budgets. The IIPDF will be available to the Sponsoring Authorities for PPP projects for the purpose of meeting the project development costs which may include the expenses incurred by the Sponsoring Authority in respect of feasibility studies, environment impact studies, financial structuring, legal reviews and development of project documentation, including concession agreement, commercial assessment studies etc.

 

Transaction Advisors:The Government of India has considered that implementation of this policy will require a capacity to determine the suitability and feasibility of PPP transactions and to implement agreed transactions. This entails agencies concerned at central, state and municipal government level have access to appropriate advisory support for the implementation of PPP transactions. Accordingly, Government of India has finalised a panel of pre-qualified Transaction Advisers to assist the agencies concerned with identifying and retaining transaction advisers. This panel is available to all sponsoring authorities includingcentral, state and municipal governments and their agencies who are undertaking PPP transactions.

 

 PPP Models in practice

There are range of PPP models that allocate a responsibilities and risks between the public and private partners in different ways. The following terms are commonly used to describe typical partnership agreement.

 

  • Build Operate and Transfer (BOT)

  • Build-Own-Operate-and-Transfer (BOOT)

  • Build-and-Transfer (BT)

  • Build-Own-and-Operate (BOO)

  • Build-Lease-and-Transfer (BLT)

  • Build-Transfer-and-Operate (BTO)

  • Design Built Finance Operate (DBFO)

  • Contract-Add-and-Operate (CAO)

  • Develop-Operate-and-Transfer(DOT)

  • Lease Management Agreement

 

Projects Handled by TUFIDC

 

S.No.

Name of the Project

Transaction Advisors

1

O&M of Street Lighting in 9 Urban Local Bodies (ULBs) in Telangana

M/s. Price House Water Coopers

2

Foot Over Bridges in Urban Local Bodies (ULBs)  in Telangana State

M/s. Price House Water Coopers

3

Pay & Use Toilets in Urban Local Bodies (ULBs)  in Telangana State

M/s. CRISIL Risk & Infrastructure Solutions

 

1. Foot Over Bridges

  • Single bid for 2 FOBs in Khammam ULB was received. Government issued orders accepting the sole bid and accordingly APUFIDC issued Letter of Award to M/s.Prakash Arts Pvt. Ltd. for Khammam ULB for 2 sites, Agreement yet to be executed.

 

2. Pay and Use Toilets

  • One single bid each for different locations for 4 PUTs in 3 ULBs were received.

  • The Bidder M/s.Suvidha Sanitation has executed the Concession Agreement for 1 PUT in Nirmal ULB.

  • As the said site was in dispute M/s.Suvidha Sanitation requested to return the performance security and bid security. APUFIDC has returned the performance security and bid security to the bidder.

 

3. Street Lighting Project in 9 ULBs

  • As against 9 ULBs notified for energy saving street lighting, only two bids were received and after due evaluation they were rejected as they were non-responsive. Government approval has been requested for re-bidding. Government has given permission for rebidding.

  • Pre-bid meeting was held on 29-01-2013 for the finalization of pre-bid queries. The bidders requested to perform energy audit in 9 ULBs before the selection of successful bidder and sharing of O&M. Accordingly letters were sent to NREDCAP to perform energy audit in 9 ULBs, but NREDCAP are still in process of selecting the bidders and the project is getting delayed.

  • APUFIDC discussed with Energy Efficient Service Ltd (EESL) for baseline study and EESL informed that they will furnish fresh proposals for all the 9 ULBs by 15-12-2013. A meeting was held in CDMA on 12-12-13 with EESL, in the meeting APUFIDC & CDMA requested EESL to furnish Pilot Project Proposal for Siddipet Municipality, EESL had furnished the proposal for Siddipet Municipality.

 

Group-1 ULBs

1. Karimnagar

6. Khammam

2. Ramagundam

7. Kothagudam

3. Mancherial

8. Suryapet

4. Warangal

9. Siddipet

5. Mahabubnagar