PPP given fresh Tk 3,000cr fund
The government proposed to inject Tk 3,000 crore fresh fund into Public Private Partnership projects in the next fiscal year, ease the project approval process and set up a separate office that would deal with PPPs.
Experts, however, fear private entrepreneurs will not respond with much enthusiasm to PPP projects of the next fiscal year due to the lack of profitability guarantee and priority projects.
They suggested that clear provision be stated in the guidelines about private entrepreneurs' involvement in projects and their involvement in the new PPP office.
The finance minister yesterday also proposed diverting Tk 1,600 crore from previous year's allocation to PPP projects to Bangladesh Infrastructure Finance Fund with the hope of avoiding probable investment shortfall in infrastructure development and maintenance.
The finance minister in his budget speech admitted that despite much enthusiasm and eagerness insignificant investment have been made to PPP projects during the 2009-10 fiscal year due to lack of proper laws and operating authorities.
He hoped the new PPP guidelines and separate office would cut lengthy project approval process in the next fiscal years.
The minister said the PPP fund would help reduce probable investment deficit in infrastructure development and maintenance.
Former adviser to a caretaker government Mirza Aziz said the proposed budget did not mention anything about if the private sectors would feel interested and safe to join PPP projects.
"The private sector has to be assured of their profitability in PPP projects. There has to be clear provision about their risk of investment and stake rationing between government and private partners," Aziz said.
He said the government should listen to private-sector inputs for the PPP guidelines and people of the private sector have to be involved in the new PPP office to make the private sector interested in projects.
Former adviser to a caretaker government Akbar Ali Khan said heavily depending on PPP projects for energy and power is a risky strategy.
He said in a neighbouring country it has been observed that one out of four probable entrepreneurs respond to PPP projects, which is why the government should not depend on PPP for power and energy projects.
He said bringing projects of social welfare, education, and health under PPP will only devalue the actual idea of PPP.
The finance minister in his budget speech has said agreements have been signed to construct four power plants on rental basis under PPP.
Five land ports, out of the 13 commissioned under the PPP, have begun their operations. Steps have been taken to run the management of the new mooring container terminal at Chittagong and of another one at Mongla under joint public and private ownership, the minister said.
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