In a bid to boost infrastructural development, the Centre, has chalked out an action plan to accelerate the process of approval of infrastructure-related projects in road and power sectors under Public Private Partnership (PPP) programme.

The objective is to further minimise the time needed for giving final approval to PPP projects so that cost overrun is avoided, sources said.

To avoid delays, the government last year set up Public Private Partnership Appraisal Committee (PPPAC) with the mandate to fast track the appraisal and approval of central sector PPP projects where capital costs or underlying value of the assets is more than Rs 250 crore.

Due diligence

Public Private Partnership Appraisal Committee is expected to complete its due diligence within a period of four weeks for final approval and the PPPAC has been keeping to this timeline. Since its constitution in January 2006, Public Private Partnership Appraisal Committee has so far received 40 proposals out of which 28 have been granted in-principle or final approval.

Fast track clearance

“The fast track clearance in the highways sector can be assessed from the fact that out of 29 road projects received so far, 23 have been granted in-principle or final approval,” sources said.

In the past, the timeline for approval of central sector projects has generally been 14 to 16 weeks.  The decisions of Public Private Partnership Appraisal Committee are consensual in nature and the Administrative Ministries participate in the decision making as members.

 “There is a special obligation imposed on the government to ensure service quality and due diligence before approval is granted,” sources said.

Further, according to sources, “the Public Private Partnership Appraisal Committee has been adding value by accelerating approval process within the government thereby reducing transaction costs.”