Date:23/05/2006 URL: http://www.thehindubusinessline.com/2006/05/23/stories/2006052300720700.htm

Back Centre allows States to follow PPP model on lines of NHAI

Our Bureau

Must show concession pacts

New Delhi , May 22

The Centre has agreed to let States take up road projects on public-private partnership (PPP) basis in a similar manner as followed by NHAI, provided they show their concession agreements to the Centre before undertaking such projects.

This emerged at the Conference of Chief Secretaries on Public Private Partnership (PPP) in Infrastructure here.

"At the meeting, several States asked if they can take up road construction projects, in a manner similar to that followed by NHAI, on those stretches of roads that are not national highways," said Mr L.K. Joshi, Secretary, Department of Road Transport and Highways.

"We said they can take up similar projects provided they show us their concession agreements. This is to ensure that the agreements are on similar lines of those followed by NHAI," said Mr Joshi.

Explaining that the PPP model helps the Government take up more infrastructure projects, Mr Montek Singh Ahluwalia, Deputy Chairman, Planning Commission, said with road projects taken on PPP basis, Government provides a subsidy of about seven per cent of the total capital cost.

"That means for every Rs 100 spent on a project, Government spends Rs 7. The alternative would have been to build them entirely with Government funds," he said.