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Ppp

Public Private Partnership means an arrangement between a government or statutory entity or government owned entity on one side and a private sector entity on the other, for the provision of public assets and/ or related services for public benefit, through investments being made by and/or management undertaken by the private sector entity for a specified time period.

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Ppp

  1. 1. 1 PUBLIC PRIVATE PARTNERSHIP CASE STUDY: AMRITSAR INTER-CITY BUS TERMINAL
  2. 2. 2 THE OBJECTIVES OF PPP IN INFRASRUCTURE • Increase the availability of infrastructure services • To do so with greater efficiency (lower cost for the level of services provided) than could be achieved using the traditional public sector approach WHAT IS PUBLIC PRIVATE PARTNERSHIP? THE DEPARTMENT OF ECONOMIC AFFAIRS (DEA) DEFINES PPP AS: “PPP means an arrangement between a government or statutory entity or government owned entity on one side and a private sector entity on the other, for the provision of public assets and/ or related services for public benefit, through investments being made by and/or management undertaken by the private sector entity for a specified time period, where there is a substantial risk sharing with the private sector and the private sector receives performance linked payments that conform (or are benchmarked) to specified, pre-determined and measurable performance standards.”
  3. 3. The private sector is responsible for carrying out or operating the project and takes on a substantial portion of the associated project risks. 3CHARACTERISTICS OF PUBLIC PRIVATE PARTNERSHIP During the operational life of the project the public sector’s role is to monitor the performance of the private partner and enforce the terms of the contract. The private sector’s costs may be recovered in whole or in part from charges related to the use of the services provided by the project, and may be recovered through payments from the public sector. Public sector payments are based on performance standards set out in the contract. Often the private sector will contribute the majority of the project’s capital costs, although this is not always the case. CHARACTERISTICS OF PUBLIC PRIVATE PARTNERSHIP
  4. 4. 4 THE USE OF PPP FOR INFRASTRUCTURE PROJECTS SHOULD ONLY BE CONSIDERED WHEN: • THE PUBLIC SECTOR ENVIRONMENT IS SUITED TO SUPPORTING PPPS. • THE PROJECT IS SUITABLE TO BEING CARRIED OUT AS A PPP. • THE POTENTIAL BARRIERS TO SUCCESSFUL PROJECT IMPLEMENTATION HAVE BEEN IDENTIFIED AND CAN BE OVERCOME. • GIVEN THAT THESE CONDITIONS ARE SATISFIED, THE PROJECT MUST BE COMMERCIALLY VIABLE FOR THE PRIVATE SECTOR AND OFFER VALUE FOR MONEY (VFM) FOR THE PUBLIC SECTOR. WHEN SHOULD PUBLIC PRIVATE PARTNERSHIP BE USED?
  5. 5. 5 Phase 1: PPP identification. Phase 2: Full feasibility study, PPP preparation, and clearance. Phase 3: PPP procurement. Phase 4: Contract management and monitoring PUBLIC PRIVATE PARTNERSHIP PROCESS
  6. 6. 6CASE STUDY: AMRITSAR INTERCITY BUS TERMINAL PROJECT PROJECT DESCRIPTION Inter-city Bus Terminal Grand Trunk Road Amritsar city is the spiritual centre for the Sikh community and a hub for trade related activities in the region. Given the religious heritage of the city, Amritsar attracts large number of tourists who visit the Golden Temple. The proximity of Amritsar to the Wagah (India- Pakistan) border has also provided an opportunity for it to develop as a trading centre for cross border commercial activities. A significant section of the local population uses public transport such as buses for movement across the state.
  7. 7. 7 Fig: Inter city Bus Terminal of Amritsar The existing bus terminal of Amritsar city, which functioned as an intercity terminus, was established in 1965 on the G.T. Road and is spread over 8.5 acres. As per the bus schedules drawn up by the Department of Transportation (DoT), Government of Punjab (GoP), there were as many as 1,800 to 2,000 bus arrivals per day at the Amritsar bus terminal. The DoT, GoP facilitated by the Punjab Infrastructure Development Board (PIDB) decided on modernising and developing the existing Amritsar bus terminal through the Build, Operate, Transfer (BOT) route. The project is under operation by a private operator for a period of 11 years and 5 months, which includes the construction period. At the end of the concession period, the project will transfer back to the concessioning authority free of all encumbrances.
  8. 8. 8PUBLIC PRIVATE PARTNERSHIP STRUCTURE OF THE PROJECT Through a two stage bidding process, DoT, GoP awarded the contract to Rohan Rajdeep Infrastructure (a partnership between Rohan Builders (India) Pvt Ltd., Rajdeep Buildcon Pvt Ltd) to undertake the development and operation of a modern bus terminal at Amritsar on a BOT basis. Under the concession agreement, the private operator was responsible for finance, building, operations and maintenance of the Amritsar Intercity Bus Terminal complex for a concession period of 11 years and 5 months. The private operator was required to pay a project development fee of Rs 35 lakhs for the project site lease and a lease rental of Rs 50,000 per month for use of the project site over the concession period. Within the concession agreement, two potential revenue streams for the private operator were identified. The first revenue stream was through the operations of the bus terminal. The second source of revenue was commercial rentals from shops located within the Intercity Bus Terminal complex. Other sources of revenue included the sale of advertising rights as well as parking fees.
  9. 9. 9PUBLIC PRIVATE PARTNERSHIP PROCESS PROJECT DEVELOPMENT CONDITIONS PRECEDENT PERIOD (90 DAYS) CONSTRUCTION PERIOD (90 DAYS) The concessioning authority was required to do: • Temporaryshifting of the existing bus terminal to a different location. • Transfer of land from the Amritsar Municipal Corporation to Government of Punjab and thereafterpossession under a lease to the private operator. • Authorising the private operatorto collect“adda fees” from buses using the Intercity Bus Terminal. The private operator on his part was required to: • Obtain all necessary clearances and approvals. • Pay the projectdevelopmentfee of Rs. 35 lakhs to the concessioning authority. • Within 30 days of receiving the notice of commencement, the private operatorwas required to mobilise resources to undertake construction activities. • The private operator was required to prepare, maintain and get necessary approvals of the detailed drawing regarding the project design. • The construction was required to be completed within 18 months of commencement. • Necessary tests were carried out by the concessioning authority prior to issue of completion certificate.
  10. 10. 10IMPLEMENTATION FRAMEWORK OF THE PROJECT DEPARTMENT OF TRANSPORTATION MODERN BUS TERMINAL COMPLEX Adda fees Lease of commercial spaces Night Parking fees Advertisements Revenue • Design & Construction of terminal facility • Operation including deploying of adequate staff • Traffic and movement management & Planning Concessionaire: Rohan Rajdeep Infrastructure Pvt. Ltd. Ensure non competition Handover of land Undertake Development Extra contractual guarantee for ensuring demand through directive to all bus operators to use the facility MAINTENANCE BOARD Monitor projectprogress Representation on the board Representation on the board
  11. 11. 11DELIVERY OF THE PROJECT EXIT OF THE PROJECT At the end of the concession period all immovable and movable property relating to the project will transfer to the concessioning authority, free of all encumbrances. The concessioning authority will issue a vesting certificate as proof of transfer of all rights, titles and interests in the Amritsar Intercity Bus Terminal assets and facilities. The Amritsar Intercity Bus Terminal construction was completed and commissioned in October 2005. The Intercity Bus Terminal includes 53 embarkation and 8 disembarkation bays covering long distance and local bus routes. The Terminal has parking provision for 54 cars, 102 rickshaws/autos and 1838 two-wheelers / cycles and 300 passenger seating berths. The private operator had the right to levy, collect, retain “adda fees” from all buses using the Intercity Bus Terminal. For the duration of the concession period, the private operator had to pay a monthly lease rental of Rs 50,000 to the concessioning authority for lease of Intercity Bus Terminal site.
  12. 12. 12 THANK YOU! 

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