Public Private partnership model for economic transformation in Rajasthan :

Public-private partnerships between a government agency and private-sector company can be used to finance, build and operate projects, such as public transportation networks, parks and convention centers. Financing a project through a public-private partnership can allow a project to be completed sooner or make it a possibility in the first place.

The Government of Rajasthan recognizes that constraint-free infrastructure provisioning, both physical and social, fosters economic and industrial activities conducive to development and inclusive growth. Typically, the Government of Rajasthan has sought to deal with infrastructure provisioning by implementing various programmes and projects departmentally and through its agencies. These are being financed through various sources including budgetary resources, grants and loans from Government of India, and bilateral and multi-lateral agencies. Budgetary provisions towards development and upkeep of these services have, however, remained inadequate over the years. So the emergence of Public-Private Partnerships (PPPs) is seen as a sustainable financing and institutional mechanism with the potential of bridging the infrastructure gap.

Institutional and other Measures :

 1. A three-tier institutional mechanism has already been established in the State:

• Empowered Committee on Infrastructure Development (ECID), headed by the Chief Secretary, to approve the project to be implemented on PPP format.

• PPP Cell, under the direct supervision of the Principal Secretary, Planning Department, who is the State PPP Nodal Officer, acts as the Nodal Agency to coordinate and monitor the PPP projects. This Cell serves as the secretariat of the ECID and being strengthened to support departments in project development, appraisal and evaluation. This Cell provides all hand-holding support for development of these projects.

• Implementing Agencies – the respective administrative departments/agencies to identify, develop and execute the PPP projects. Respective administrative departments have nominated one of the officers as nodal officer for PPP projects.

2.  The State procures Transaction Advisors for developing the PPP projects presently through the following options: • open advertising route. Model documents of Request for Proposal for procuring Financial Consultants, Technical Consultants and Legal Advisers. • through limited bidding amongst transaction advisors (at least five) empanelled by the Department of Economic Affairs, Ministry of Finance, Government of India, if the cost of the proposed project is up to Rs. 250 crore. • engage PDCOR Ltd. on single source basis for consultancy services up to Rs. 2 crore.

3.  A new fund titled "Rajasthan Infrastructure Project Development Fund" (RIPDF) has been created with an initial corpus of Rs. 25 crore for supporting the development of credible and bankable PPP projects that can be offered to the private sector and the other infrastructure projects wherein Government of Rajasthan reimburses project development expenses.

4. Rajasthan Social Sector Viability Gap Funding Scheme has been notified for promoting PPPs. All Administrative Departments, Autonomous Organizations and local bodies of the State are eligible to get viability gap support for their social sector infrastructure and services.

5.Rajasthan is one of the States selected under the National PPP Capacity Building Programme (NPCBP) launched by Department of Economic Affairs, Ministry of Finance, Government of India in 2010 with support of KfW (German Development Bank) and the World Bank.

6. To build a virtual market place for the PPP stakeholders, Government of Rajasthan has created a PPP website that is a one stop site for all information relating to PPP initiatives in the State.

Sectors  where PPP model has been introduced in the state :

Road Sector  : Rajasthan has been in the forefront of successfully implementing a number of road sector projects in the recent past. Rajasthan was the first State to formulate a policy for Build-OperateTransfer (BOT) projects in 1994. The Rajasthan Road Development Act, 2002, encourages private sector participation in the construction of financially viable bridges, bypasses, rail over-bridges, tunnels, etc. The Act provides formal framework for projects on BOT in the Roads sector. Under the State Road Development Fund Act, 2004, a nonlapsable State Road Fund (SRF) was created through levy of 50 paisa Cess on petrol / diesel. SRF is being leveraged to take up large/mega State Highways projects.

During the 12th Five Year Plan period, sixteen mega highways comprising length 2929 km of State highways and major district roads costing to Rs. 3586 crore are proposed. The project development process for these projects is in different stages.

Urban Infrastructure : PPP projects in the Urban Infrastructure sector are being intensively pursued. These include the Metro Rail Project in Jaipur, Exhibition-cum-Convention Centre in Sitapura, Jaipur and Ring Road Project in Jaipur. The metro rail urban transport project in Jaipur is for the provision of affordable connectivity solutions for the city's citizens. The project has been sanctioned under the India Infrastructure Project Development Fund (IIPDF) Scheme of the Government of India for project development.

The Rajasthan State Industrial Development and Investment Corporation Limited (RIICO) proposes to undertake development of the Exhibition-cum-Convention Centre Project through Public-Private Partnership on Design, Engineer, Finance, Construct, Market, Operate, Manage and Transfer basis. The Centre is proposed in the Sitapura Industrial Area (Jaipur) at an estimated cost of Rs. 225 crore. The preferred bidder has been identified consequent upon the Request for Proposal for the project.

Social Sector :  The State Government is actively pursuing PPP projects in the social sector. The State Government constructed a state-of-the-art hospital building in Mansarovar, Jaipur. A project has been structured on finance, equip, operate and transfer basis to function a hospital (Manas Arogya Sadan Hospital) out of this building.

In the higher education segment, the State Government has initiated a project for establishment of a University for Physical Education and Sports in Jhunjhunu on PPP mode. State Government has also set up some ITIs, Polytechnics and Engineering Colleges on PPP mode in lagging areas. State Government provides free-of-cost converted land not exceeding 10 acres on 25 years lease basis to the selected private developer specifically for women polytechnics and reimburses capital cost amount up to Rs. 2.90 crore per polytechnic. The remaining non-recurring and entire recurring expenditure are borne by the selected private developer.

Water Sector  : Rajasthan, a water deficient province, has many water transmission and distribution projects which are pending resource allocation and subsequent implementation. Private investment in surface water projects has not evoked much interest. Unresolved public policy issues in environment and social sphere impinges on large scale private investment in development of water resources. However, private markets, particularly in irrigation may be justified and feasible.

Power Sector  : Looking to the huge requirement of funds for the power sector and to facilitate smooth and rapid development of transmission capacity, a sizable part of investments is being sought from the private sector. Rajasthan Rajya Vidyut Prasaran Nigam Limited has been authorized to act as the Bid Process Coordinator (BPC) for the purpose of selection of Bidder as Transmission Service Provider (TSP). Rajasthan Rajya Vidyut Prasaran Nigam Limited is implementing the various transmission projects on Build, Own, Operate and Maintain (BOOM) basis.

Tourism Sector : The State Government is also executing some projects on PPP mode in tourism sector. These include Jal Mahal Integrated Tourism Project, Jaipur costing to Rs. 200 crore, Restoration and Conservation of Tijara Fort, Alwar costing to Rs. 25 crore, which are being implemented by Rajashtan Tourism Development Corporation (RTDC) in phases.

Information Technology Sector : To modernize the communication infrastructure with an aim to grow the administrative efficiency and effectiveness, the Government of Rajasthan is implementing the RajSWAN project on BOOT basis. The total cost of the project is Rs.120.21 crore.

               The Government of Rajasthan recognizes that the private sector can play a prominent role in infrastructure development. PPP is evidently emerging as the preferred route to leverage private capital as well as to induct private sector. A closer partnership between the public and private sectors can support sustainable development, reduce poverty, and ultimately foster greater prosperity. Also, there is huge demand of modern urban infrastructure facilities in Rajasthan as most of the State's cities do not have equal/adequate provision of basic and modern infrastructure services - safe drinking water, waste water treatment, sanitation, waste collection and treatment, continuous electricity (and energy, in general), multi-level parking, public transport, etc. Therefore, PPPs would be encouraged for both building and maintaining the urban infrastructure during the Twelfth Five Year Plan period. PPP being useful both for building infrastructure as well as for improving the provision of services, the State Government has undertaken certain measures in support of its PPP initiative.