Friday, April 26, 2013

Investment Board open to PPP model

Public private partnership (PPP) may not be suitable for all projects, but the Investment Board has no bias against the model as long as the private sector delivers, according to experts.
"The PPP model may not be suitable for all projects but the Investment Board will not have any bias towards it as long as there is a clear case that the private sector can deliver the service more cost effectively," said senior advisor at the board Sanjay Poudyal during an interaction, here today.
More than 25 countries have established PPP agencies and enacted PPP specific legislations, he said, adding that private participation in infrastructure has had many labels over time and the nomenclature differs by language and geography. "But PPP is an arrangement between government and the private sector, where each side contributes its inherent strengths and advantages to deliver public services and infrastructure more quickly and cost effectively."
The government is accountable for essential services to the public, regulation and policy oversight and the private sector designs, constructs, operates and maintains public infrastructure on behalf of the government, he added.
The board also updated the progress of its projects highlighting the importance of Public Private Partnership in Nepal. It has received a good response on call for proposals for Nepal Investment Year 2013 and is in the process of developing dossiers for each project, said chief executive of the board Radhesh Pant, on the occasion.
"Project Negotiation Agreement was signed with SN Power for Tamakoshi-3 Project last week," he informed, adding that a Project Negotiation Agreement is a contractual arrangement that provides the developer security and tenure over project while the government guarantees that it will not negotiate with a third party about the project for the term of the agreement, while the parties negotiate a Project Development Agreement. "IBN Project Development Agreement Negotiation team has now been finalised along with necessary technical, legal and commercial advisors."
Project Development Agreement template is in the process of being tailored to individual projects and negotiations with developers of four export-oriented hydropower producers started on April 15, according to him. "The board has received application from Dangote Cement PLC expressing their interest in establishing a cement company in Nepal."
The Investment Board was set up in November 2011 as a one-window solution for foreign investors and developers investing in hydro projects above 500MW and other infrastructure projects above Rs 10 billion to fast track projects and cut through bureaucratic obstacles and delays.

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