Contents

Foreword

Preface

List of Abbreviations and Acronyms

Chapter 1 Understanding PPP

§ Introduction

§ PPP — A New Name for an Old Game: Brief History

§ Respective Roles of Public and Private Sectors

§ Value for Money

§ Benefits of PPP

§ Output-Based Approach

§ PPP and Privatization

§ Models of Private Participation

§ PPP — Public Private Partnership or Paying for Private Profit

§ Indian Scenario

§ Stumbling Blocks

§ Initiatives by the Government

§ Way Forward

Box 1.1 — Eik Aur Eik Gyaraha — One and one make eleven

Box 1.2 — PPP — Many Names

Box 1.3 — Two to Tango . . . PPP Also!

Box 1.4 — PPP Profile

Box 1.5 — Decision to Invest in a Developing Country

Chapter 2 Propelling PPP

§ Introduction

§ Policy Framework

§ Partnership Architecture

§ Procedural Network

§ Institutional Structure

§ Sovereign Support

§ Government Guarantee

Box 2.1 — Red-Tape — A Glaring Example

Box 2.2 — Tango or Tug of War

Box 2.3 — Transparency in PPP Bidding

Box 2.4 — Dogs Know Better . . . !

Box 2.5 — Opportunistic Behaviour or Larger State Interests

Box 2.6 — Government Guarantee — A Boom or Band-Aid

Box 2.7 — Guarantee or Comfort Letter

Box 2.8 — UCH Power Project — Pakistan

Chapter 3 Risk — Identification: Mitigation: Allocation

§ Introduction

§ Risk Identification

§ Risk Mitigation

§ Risk Allocation

Box 3.1 — Risk and Its Meaning

Box 3.2 — Water Tariff — A Sensitive Issue

Box 3.3 — Anachronistic Cost of Deep Discount Bonds

Box 3.4 — Compensation for Expropriation — World

Bank Guidelines

Box 3.5 — Public Participation and Political Risks

Chapter 4 Financial Approach

§ Introduction

§ Financing — General Factors

§ Financing — Deciding Determinants

§ Financing — Financial Involvements

§ Financing — Sources and Tools

§ Financing — Cost Components and Financing Sequence

Box 4.1 — “Responsibilidad Patrimonia” — A Statutory Comfort

Box 4.2 — Angel Grant

Box 4.3 — Financial Closure

Box 4.4 — Government Financial Involvement — Malaysian

Example

Box 4.5 — Financing of Santa Rita Project-Philippines

Box 4.6 — Financing of Batu Hijau Project Indonesia

Box 4.7 — Financing of Phu My 3-Project, Vietnam

Chapter 5 Contractual Framework of PPP

§ Introduction

§ Salient Features of a Concession Contract

§ Distinction Between a Concession Contract and a Commercial Contract

§ Concession Arrangement — Critical Issues

§ Unsolicited Proposals

§ Contractual Structure

Box 5.1 — Display of Transparency

Box 5.2 — Styles of Concession Contracts

Box 5.3 — Single Source : Multiple Roles

Box 5.4 — Model Concession Agreement

Chapter 6 Legal and Regulatory Framework of PPP

§ Introduction — Legal Framework

§ Infirmities of Existing Legal Framework

§ Introduction — Regulatory Framework

§ Regulatory Body

§ Regulatory Functions

§ Contracting Out Regulatory Functions

§ Regulation by Contract

§ Indian Scenario

§ Independent Regulators

Box 6.1 — An Empowered Regulator — A Positive Factor

Box 6.2 — New Zealand Experiment

Box 6.3 — An Unempowered Regulator — A Negative Factor

Box 6.4 — Regulatory Authority — Not a Magic Baguette

Box 6.5 : — Regulator for Delhi Metro

Chapter 7 Recognising Infrastructure

§ Introduction

§ Salient Features of Infrastructure

§ Importance of Infrastructure

§ Commercialisation of Infrastructure

§ Infrastructure and Environment

§ Infrastructure and the Poor

§ Policy Framework for Infrastructure Development

§ Indian Scenario

§ Phases of Project Development

§ Slow Progress

§ Way Forward

Box 7.1 — Time and Cost Overruns of Central Projects

Box 7.2 — Land in Locker

Chapter 8 Roads and Related Infrastructure

§ Introduction

§ Salient Features of a Toll-Based PPP Road Project

§ Risk Profile

§ Toll Profile

§ Award Criteria for Toll Road PPP Project

§ Contractual Framework of a Toll Road Project

§ Indian Scenario

§ Encouraging Public Private Participation

§ Way Forward

§ Project At-A-Glance: The Prado-Carénage Tunnel Marseille , France

§ Project At-A-Glance: Vasco Da Gama Bridge, Lisbon , Portugal

§ Project At-A-Glance: State Route-91, California , USA

§ Project At-A-Glance: Noida Toll Bridge

Box 8.1 — Road Safety

Box 8.2 — Actuals Against Forecasts

Box 8.3 — Free Parallel Roads and Malpractices

Box 8.4 — Pre-construction Risks and Government Commitments

Box 8.5 : — Construction Cost of a Toll Road

Box 8.6 — Securitization of Toll Collections

Box 8.7 : — High Tech Toll Collections — AVI

Box 8.8 — Noida Toll Bridge — A Guaranteed Return Contract

Box 8.9 — NHAI Mandate

Chapter 9 Water and Sanitation

§ Introduction

§ Commodification of Water

§ Tradeable Property Rights

§ Salient Features of Water and Sanitation

§ Risk Profile

§ Gradual Private Participation

§ Tariff Structure

§ Water and Subsidy

§ Indian Scenario

§ What Ails Water Infrastructure in Urban Areas

§ Encouraging PPP

§ Commercial Orientation of ULBs

§ Jawaharlal Nehru National Urban Renewal Mission (JNNURM)

§ Way Forward

§ Project At-A-Glance: Tirupur Water and Sewage Project

§ Project At-A-Glance: Chengdu Water Treatment Plant , China

§ Project At-A-Glance: Water Supply and Sanitation Management

Contract La Paz and El Alto Bolivia

§ Case Study: Manila Water and Sewage System — A Study of

Two Contrasts

Box 9.1 — Urbanization

Box 9.2 — Water a Pure Economical Commodity !!!

Box 9.3 — The Earth’s Water

Box 9.4 — Water Treatment

Box 9.5 : — Management Contract for Water Service in Atlanta

Box 9.6 — Experience of Cochabamba — Bolivia

Box 9.7 — Water — The Poor Pay the Maximum

Box 9.8 — Performance-Based Service Contracts in Navi Mumbai

Box 9.9 — Concession Fact File

Chapter 10 Urban Rail Transit

§ Introduction

§ Salient Features of MRTS

§ Positive Externalities

§ Benefits of MRTS

§ Risk Profile

§ Tariff Structure

§ Metro: The Integration Leader

§ Train to the Plane

§ Value Capturing — A New Approach

§ PPP for Metro Rail Project

§ Indian Scenario

§ Way Forward

§ Project At-A-Glance: MRT-3 Metro Manila

§ Project At-A-Glance: Brisbane Airtrain

§ Project At-A-Glance: Delhi Airport Express Line — A Success

Story of Public Private Partnership (PPP)

§ Case Study: Delhi Metro — A Success Story of Centre-State

Partnership

Box 10.1 — Forms of Urban Rail Transit

Box 10.2 — Floating Train: Maglev

Box 10.3 — Seamless Mobility

Box 10.4 — Share in Value Appreciation

Box 10.5 : — Metro in India : Spirited Effort

Chapter 11 Airports

§ Introduction

§ Salient Features of Airports

§ Changing Trends of Airport Industry

§ A Multi-Product and Complex Infrastructure

§ Risk Profile

§ Structuring the Tariff

§ Indian Scenario

§ What Ails Indian Airports

§ Encouraging PPP

§ Way Forward

§ Project At-A-Glance: The Phnom Penh Airport — Cambodia

§ Project At-A-Glance: Felix Houphouet Boigny International Airport ,

Abidjan

Box 11.1 — Airports

Box 11.2 — Concession Arrangement in Argentina and Colombia

Box 11.3 — Airports in India

Box 11.4 — Cochin International Airport

Box 11.5 — Greenfield Airport at Bengaluru & Hyderabad and

Modernization of Delhi and Mumbai Airports

Chapter 12 Ports

§ Introduction

§ Changing Trends

§ Salient Features of Ports

§ Port Assets and Services

§ Port Management Models

§ Risk Profile

§ Indian Scenario

§ What Ails Indian Ports

§ Public Private Partnership in Port Sector

§ Way Forward

§ Project At-A-Glance: Laem Chabang Port

Box 12.1 — Objectives of Ports

Box 12.2 — Ship: Bigger The Better

Box 12.3 — Value Adding Services at Port

Box 12.4 — Port Labour Productivity

Box 12.5 : — Some Facts About Port Costs

Chapter 13 Power

§ Introduction

§ Power Sector Reforms

§ Salient Features of Power

§ Risk Profile

§ Models of Power Sector

§ Power Subsidy

§ Indian Scenario

§ What Ails Indian Power Sector

§ Initiatives by Government

§ Way Forward

§ Project At-A-Glance: Gvk Plant at Jegurupadu

§ Project At-A-Glance: Santa Rita Power Project — Philippines

§ Case Study: Dabhol Debacle: Enron Experience

Box 13.1 : — Power Purchase Agreement of GVK Jegurupadu Project

Box 13.2 — Lessons from California ’s Power Crisis

Box 13.3 — International Trade of Power

Box 13.4 : — Factors Influencing Worst Investment Experiences

Box 13.5 — Affordable Prices — A Major Factor

Box 13.6 — Electricity Supply to Farmers

Box 13.7 — Slow Progress of PPP in Power

Box 13.8 — Indian Power Sector — A Leaking Bucket

Box 13.9 — Enron — Allegations, Accusations and Acrimony

Box 13.10 — Rebuttal by Enron

Chapter 14 Telecommunications

§ Introduction

§ Reforms

§ Salient Features of Telecommunications

§ Technical Features

§ Risk Profile

§ Digital Divide — Challenges and Opportunities

§ Encouraging Private Participation

§ Indian Scenario

§ Telecom Regulatory Authority of India (TRAI)

§ Universal Service Obligations

§ Encouraging Private Participation

§ Way Forward

§ Project At-A-Glance: Antel , Uruguay

§ Case Study: Bharti Airtel — A Telecom Titan

Box 14.1 — Cellular Revolution

Box 14.2 — Broadband

Box 14.3 — Infrastructure Sharing

Index