2. According to Van Ham and Koppenjan,”PPP are
cooperation of some sort of durable activity between
public and private actors in which they jointly
develop products and services and share risks, costs
and resources which are connected with these
products.”
Cooperative institutional arrangements between
public and private enterprises which has gained
wide interest around the world
It is a way to handle infrastructure projects
It reduces pressure on government budgets
It increases value for money in infrastructure
INTRODUCTION TO PPP
3. PPP PROJECT: A project based on a contract or
concession agreement, between a government
or statutory entity on one side and a private
sector company on other side, for delivering an
infrastructure service on payment of user
charges
PPP APPRAISAL COMMITTEE (PPPAC):
Includes Secretary of Planning Commission,
Department of expenditure, Department of
legal affairs and Department sponsoring the
project
TERMS IN PPP
4. Cooperative and contractual relationship
Shared responsibilities
Procurement
Risk transfer
Flexible ownership
CHARACTERISTICS OF PPP
5. Institutional cooperation
Long-term infrastructure contracts
Community development
Urbanization
Economic development
MAJOR ARRANGEMENTS
BETWEEN PUBLIC & PRIVATE
PARTICIPATION
6. FDI refers to the net inflows of investments to
acquire a lasting management interest (10% or
more of voting stock) in an enterprise operating
in an economy other than that of investors
Major investors include Individuals, Group,
Private and Public entity
FDI = Equity capital + Reinvestment of earnings +
Short-term capital + Long-term capital
FOREIGN DIRECT INVESTMENT
(FDI)
7. Sustaining a high level of investment
Technological gap
Exploitation of natural resources
Understanding initial risk
Development of basic infrastructure
Improvement in Balance of Payments position
Foreign firm’s helps in increasing the
competition
ARGUMENTS IN FAVOR OF
FDI
8. Stable policies
Economic factors
Cheap and skilled labour
Basic infrastructure
Unexplored markets
Availability of natural resources
DETERMINANTS OF FDI IN
INDIA
9. Availability of scarce factors of production
Improves Balance of Payments
Building of economic and social infrastructure
Fostering economic linkages
Strengthening of the government budget
ADVANTAGES OF FDI TO
HOST COUNTRY
10. Balance of Payments depends on improvement
of technology
Employment of expatriates
Unhealthy competition
Cultural and political issues
DISADVANTAGES OF
FDI TO HOST COUNTRY
11. Improves availability of raw material
Improves Balance of Payments of country
Creates more employment
Creates more revenue
Builds political relations
Gets better investment opportunity
ADVANTAGES OF FDI
TO HOME COUNTRY
12. Too much exploitation of factors of production
Conflict with government of host country
DISADVANTAGES OF
FDI TO HOME COUNTRY