Page 106 - ITU-T Focus Group Digital Financial Services – Executive Summary

3 Conclusions

Lessons Learnt

The PPP model for Indian Airports has surpassed the initial expectations in terms of economic benefits and
better infrastructure. This has also created a whole new travel experience, besides providing decent facilities
for travellers.
Despite various bottlenecks, PPP in infrastructure holds great potential in a country like India. A long-term
sustainable infrastructure plan needs to be developed that will create an environment for increased private
sector investments for faster execution of the projects. Collective efforts by both the private and the public
sector and enabling policy provisions may help in achieving the infrastructure PPP agenda of the government.
Critical success factors
The critical success factors have been:
• The Aviation policy of the Government of India
• The fact that PPPs can supplement limited public sector capacities and raise additional finance in an
environment of budgetary constraints.
• Privatization has improved the breadth, efficiency and the quality of services available.

Challenges ahead
The PPP mode comes with its own set of challenges since attracting private investment is not straightforward.
The private sector not only requires an investor-friendly regulatory environment, but also returns on
investment. The Government of India (GoI), therefore, has been focusing on the development of enabling
tools and activities to encourage private sector investments in the country through the PPP format.

The Government needs to work on each stage of PPP development — planning, designing, contracting,
financing and monitoring. New models for PPP need to be created to cater to the current challenging business
climate. Unless project agencies are suitably empowered for effective and time-bound decision making, the
PPP agenda of the country is going to take time to evolve and develop. There also needs to be a clear
demarcation of the risks to be borne by public and private parties.

Transferability to other cities and scalability:
Further development is under progress, through the PPP model for new airports such as Goa, Navi Mumbai.
These projects are based on the learnings of over a decade of the privatization process. These new benefits
have started percolating down to the smaller cities.
The projects are scalable, as there is immense opportunity in exploiting the available commercial spaces.
With a good degree of innovation, the private enterprises involved in these projects are able to generate a
reasonable amount of revenue, and since this revenue is also shared with the Government, a certain portion
of the finances could be used to upgrade and create new airports in other lesser developed regions, which
are also in need of a better transportation infrastructure.

A References

Assessment of the airport ppp experience in India – ICAO.
Retrieved from www.icao.int/Meetings/a39/Documents/WP/wp_294_en.pdf
PPP partnerships in India – FICCI EY.
Retrieved from http://www.ey.com/publication/vwluassets/ey public-private-partnership-the-next-
continuum

This case study has been prepared by:
Vimal Wakhlu (ITU-APT)

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