Framework to Select Public–Private Partnership Modalities

Abstract

Worldwide, governments have exploited a range of contractual structures to cope with the change of project characteristics and role of stakeholders in the evolution of the approach to public–private partnerships (PPPs). This has brought about the establishment of various PPP models that enable the successful implementation of projects. In this regard, the National Highways Authority of India (NHAI) introduced the model concession agreement (MCA) forms of build–operate–transfer (BOT) (toll), BOT (annuity), and the hybrid annuity model (HAM), and has widely implemented them in the delivery of PPP road projects. However, the selection of PPP models lacked the decision-supporting framework that links project characteristics with the preference of stakeholders. The purpose of this study is to establish a conceptual framework that assists decision makers in the selection of a suitable PPP model in a well-organized way. A case study project based on systematic document review was conducted to analyze the evolution of PPP delivery models by NHAI to cope with the change of project characteristics and role of stakeholders over time. Accordingly, a conceptual framework has been developed using PPP modality selection criteria to accommodate project characteristics with the experience of clients, the private sector, and lenders in preferring a specific PPP model. The implementation of the proposed framework has been validated with case study projects. This study demonstrates the interaction between project characteristics and the preference of stakeholders in PPP models, which enhances the project value by reducing the rebidding and failure possibility of projects due to the lack of the private sector and lender’s interest.