Why is Public Private Partnership (PPP) required in infrastructural projects? Examine the role of PPP model in the redevelopment of Railway Stations in India. (UPSC CSE Mains 2022 - General Studies Paper 3)
Public-private partnerships (PPPs) are formally established agreements between public and private parties to share risks and benefits in the provision of public services and infrastructure.
Role of PPP model in the redevelopment of Railway Stations in India
- The station redevelopment comprises two components:
- Mandatory station redevelopment: It will make smooth and hassle-free travel.
- Station Estate (Commercial) development: It will enable to tap several revenue streams to ensure the viability of entire project.
- The Government of India pushing for reforms in railway infrastructure with the help of PPP. The first station redeveloped through PPP process is Gandhinagar in Gujarat.
- Other stations will be redeveloped such as New Delhi, Chhatrapati Shivaji Maharaj Terminus and many more including in tier 2 and tier 3 cities.
- The responsibility of train operations and safety certification rests with Indian Railways.
PPPs offer the public sector potential cost, quality, and scale advantages in achieving infrastructure service targets. NITI Aayog strategy for new India @ 75 envisages many targets in railway infrastructure like increasing the speed of infrastructure from the present 7 km/day to 19 km/day, 100% electrification of broad-gauge track by 2022-23.
- Developing railways not as a service, but as an asset: Station redevelopment is planned by leveraging the real estate potential of separable land and air space in and around the stations, through private participation. These redeveloped hubs will be called “Railopolis.” • Bibek Debroy Committee on the projected rebuilding of Indian Railways (IR) has urged private sector task investment and the establishment of a free controller to promote competition.
Looking ahead
Vijay Kelkar Committee Report on Revisiting and Revitalising PPP Mode should also be considered.
Proposed reforms:
- A PPP statute that provides implementing executives with a strong framework.
- IPRC (Infrastructure PPP Project Review Committee), which assesses strained PPP projects.
- Swiss challenge method: used to thwart unsolicited bids while granting contracts.
The Indian Railways is just one example of how PPP can speed up infrastructure construction. To unlock innovation’s richness of benefits and reach the target of a $5 trillion economy by 2024, it will be necessary to support it and learn from people around the world.
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