Approval of PPP guidelines
Sunday, 20 June 2010
The government has finally approved the policy, guidelines and strategies concerning the much-talked-about Public-Private Partnership (PPP) initiatives. The cabinet late last week approved the PPP-related proposals, including the one that relates to the setting up of an office that would be responsible for the implementation of projects under the PPP and enforcement of relevant rules and regulations. The PPP office will be under the control of the Prime Minister's Office (PMO) but it would be located at a suitable place outside the PMO. Besides, two committees, including the PPP advisory committee which will be headed by the Prime Minister, will soon be constituted. The policy and guidelines, approved by the cabinet, have identified the areas where investments under PPP would be allowed and set criteria of projects according to their total investment size.
It might appear from the decisions taken by the cabinet that the stage is almost set for the PPP projects to start. But in the case of Bangladesh, as it has been proved time and again, there exists a large gap between decisions and their implementation. This is not just because of political interventions. The bureaucratic complexities are no less responsible for putting many decisions taken at the top level on the hold. The fate of some PPP-related moves in the recent past is a testimony to that. None other than the finance minister himself recently pointed his accusing finger at the top bureaucrats saying that the bureaucracy's built-in resistance to change was responsible for the failure to spend even a penny out of Tk. 2.5 billion fund earmarked for the PPP initiatives in the annual development programme (ADP) for the outgoing fiscal. Actually, a tug of war had ensued between the finance ministry and the Board of Investment (BoI) over the control of PPP affairs.
The finance ministry did much of the spadework for the inclusion of the PPP concept in the budget for the outgoing fiscal. But things turned sour when the BoI appeared on the scene and some cabinet heavyweights backed it in its bid to take over the control of PPP affairs. But the delay on the part of the BoI in coming up with the all-essential guidelines for the PPP prompted the PMO to take up the onus of issuing and preparing the PPP-related policies and guidelines on itself. The decisions taken by the cabinet last week were based on the PMO work.
The government has proposed a financial provision of Tk 30 billion for PPP projects in the national budget for the next fiscal. It would be too embarrassing for the government if a large part of that money again remains unutilized as a large part of the PPP-related budgetary resources is mainly meant for infrastructure, power and energy sector projects that need to be implemented expeditiously for the greater good of the economy.
However, there could be some ambiguity in the guidelines regarding the selection of projects and equity participation of the private and public stakeholders. Actually, inconsistencies or flaws, if any, in the guidelines would surface only when their application would begin. In the meanwhile, the high officials concerned in the PMO should immediately constitute the committees, find out a suitable location for the PPP office that is easily accessible to all and do the needful to create an environment that encourages the private sector investors, both local and foreign, to join hands with the government for implementing projects that require large investment.
It might appear from the decisions taken by the cabinet that the stage is almost set for the PPP projects to start. But in the case of Bangladesh, as it has been proved time and again, there exists a large gap between decisions and their implementation. This is not just because of political interventions. The bureaucratic complexities are no less responsible for putting many decisions taken at the top level on the hold. The fate of some PPP-related moves in the recent past is a testimony to that. None other than the finance minister himself recently pointed his accusing finger at the top bureaucrats saying that the bureaucracy's built-in resistance to change was responsible for the failure to spend even a penny out of Tk. 2.5 billion fund earmarked for the PPP initiatives in the annual development programme (ADP) for the outgoing fiscal. Actually, a tug of war had ensued between the finance ministry and the Board of Investment (BoI) over the control of PPP affairs.
The finance ministry did much of the spadework for the inclusion of the PPP concept in the budget for the outgoing fiscal. But things turned sour when the BoI appeared on the scene and some cabinet heavyweights backed it in its bid to take over the control of PPP affairs. But the delay on the part of the BoI in coming up with the all-essential guidelines for the PPP prompted the PMO to take up the onus of issuing and preparing the PPP-related policies and guidelines on itself. The decisions taken by the cabinet last week were based on the PMO work.
The government has proposed a financial provision of Tk 30 billion for PPP projects in the national budget for the next fiscal. It would be too embarrassing for the government if a large part of that money again remains unutilized as a large part of the PPP-related budgetary resources is mainly meant for infrastructure, power and energy sector projects that need to be implemented expeditiously for the greater good of the economy.
However, there could be some ambiguity in the guidelines regarding the selection of projects and equity participation of the private and public stakeholders. Actually, inconsistencies or flaws, if any, in the guidelines would surface only when their application would begin. In the meanwhile, the high officials concerned in the PMO should immediately constitute the committees, find out a suitable location for the PPP office that is easily accessible to all and do the needful to create an environment that encourages the private sector investors, both local and foreign, to join hands with the government for implementing projects that require large investment.