PPP Experiences in Indian Cities: Barriers, Enablers, and the Way Forward

Abstract

Recent studies indicate that India must invest more than $150 billion over the next 5 years in the development of urban infrastructure. Urban local bodies lack the financial resources and the capacity to develop these projects on their own, pointing to a large role that public-private partnerships (PPPs) need to play in the development of urban infrastructure. This paper uses a combination of archival sources, case studies, and insights from a recently concluded roundtable discussion on PPPs to highlight five key barriers that PPP projects face in the urban Indian context. These barriers are a distrust between the public and private sector, a lack of political willingness to develop PPPs, the absence of an enabling institutional environment for PPPs, a lack of project preparation capacity on the part of the public sector, and poorly designed and structured PPP projects. A series of measures that the Government of India has undertaken to enable PPPs are evaluated and it is observed that these programs address only three of the five barriers identified. A set of nine additional strategies emanating from the roundtable are then proposed, that, in addition to the existing measures outlined by the Government of India, can help comprehensively address the challenges that PPPs in urban infrastructure that India is facing. This could help improve the quantity and quality of infrastructure services in Indian cities.