Govt sets criteria for PPP, 22 areas specified
Friday, 13 May 2011
Nazmul Ahsan
The government has fixed the criteria and characteristics for selecting projects under the Public-Private Partnership (PPP) to be implemented in 22 specified areas, according to a circular, issued from the Prime Minister's Office (PMO). The PMO has issued the circular last week asking all ministries and government offices to abide by the latest directives of the government as far as project selection and implementation under the initiative of PPP is concerned. The circular said the projects under the PPP would be eligible if the government cannot finance a project due to lack of required local resources and expertise. If a project under the initiative is considered to save implementation period compared to that of a government-funded project, ensuring better quality and services, then it may be considered potential and eligible for PPP, the circular added. The projects, no matter if they are goods or services, which might cut down the expenditure through competition among private investors, will be eligible for PPP, according to the circular. If an infrastructure project is believed to have far-reaching long-term positive impact on the national economy, it will be selected under the invigorated PPP initiative, the criteria pointed out. If the participation of the government in a PPP project clearly demonstrates that the management capacity in project implementation will be increased and the need for such a project is of paramount interest in national perspective, such a project could be selected under the PPP, the circular elaborated. The project to be implemented under the initiative must create opportunity for further private sector investment in the country and will be eligible for PPP, the circular said. Any of the above-mentioned criteria must prevail in selecting and implementing PPP-related projects, the circular added. It said a PPP Cell would be set up at the Ministry of Finance (MoF), while the PPP Office would be an autonomous organisation under the PMO. The circular said 22 specified areas, which are covered by the PPP guidelines, would be eligible for PPP. "We have specified criteria and eligibility for projects to be funded under the PPP initiative," a senior official at the PMO said. "The characteristics and major features to be maintained for selecting the PPP projects would help investors and the government to go forward with their plans on PPP," he added. The sectors where investment is allowed under the PPP include exploration, production, transmission, and distribution of oil, gas, coal and other mineral resources, construction of airports, terminals and related aviation facilities, projects on water supply and distribution, sewerage and drainage. The other areas are establishment of effluent treatment plants, land reclamation, dredging of rivers, canals, wetlands, lakes and other related facilities, construction of highways and expressways including mass transit, bridges, tunnels, flyovers, interchanges, city roads, bus terminals, commercial car parking, port development including inland container terminals, inland container depot and other services. Telecommunications systems, networks and services including information and communication technology, solid waste management projects, railway, tourism industry, economic zones, industrial estates and parks, city and property development, including services to support commercial and non-commercial activities, and poverty alleviation projects are also allowed for investment under the PPP initiative, the circular said. According to the PPP guidelines, a project having investment above Tk 2.5 billion, excluding the ongoing capital for expansion, will be classified as a large project. A project with investment between Tk 250 million and Tk 2.5 billion, excluding the ongoing capital for expansion, will be considered a medium scheme. Projects with an estimated outlay of Tk 250 million each, excluding on-going capital for expansion, will be put in the small category.
The government has fixed the criteria and characteristics for selecting projects under the Public-Private Partnership (PPP) to be implemented in 22 specified areas, according to a circular, issued from the Prime Minister's Office (PMO). The PMO has issued the circular last week asking all ministries and government offices to abide by the latest directives of the government as far as project selection and implementation under the initiative of PPP is concerned. The circular said the projects under the PPP would be eligible if the government cannot finance a project due to lack of required local resources and expertise. If a project under the initiative is considered to save implementation period compared to that of a government-funded project, ensuring better quality and services, then it may be considered potential and eligible for PPP, the circular added. The projects, no matter if they are goods or services, which might cut down the expenditure through competition among private investors, will be eligible for PPP, according to the circular. If an infrastructure project is believed to have far-reaching long-term positive impact on the national economy, it will be selected under the invigorated PPP initiative, the criteria pointed out. If the participation of the government in a PPP project clearly demonstrates that the management capacity in project implementation will be increased and the need for such a project is of paramount interest in national perspective, such a project could be selected under the PPP, the circular elaborated. The project to be implemented under the initiative must create opportunity for further private sector investment in the country and will be eligible for PPP, the circular said. Any of the above-mentioned criteria must prevail in selecting and implementing PPP-related projects, the circular added. It said a PPP Cell would be set up at the Ministry of Finance (MoF), while the PPP Office would be an autonomous organisation under the PMO. The circular said 22 specified areas, which are covered by the PPP guidelines, would be eligible for PPP. "We have specified criteria and eligibility for projects to be funded under the PPP initiative," a senior official at the PMO said. "The characteristics and major features to be maintained for selecting the PPP projects would help investors and the government to go forward with their plans on PPP," he added. The sectors where investment is allowed under the PPP include exploration, production, transmission, and distribution of oil, gas, coal and other mineral resources, construction of airports, terminals and related aviation facilities, projects on water supply and distribution, sewerage and drainage. The other areas are establishment of effluent treatment plants, land reclamation, dredging of rivers, canals, wetlands, lakes and other related facilities, construction of highways and expressways including mass transit, bridges, tunnels, flyovers, interchanges, city roads, bus terminals, commercial car parking, port development including inland container terminals, inland container depot and other services. Telecommunications systems, networks and services including information and communication technology, solid waste management projects, railway, tourism industry, economic zones, industrial estates and parks, city and property development, including services to support commercial and non-commercial activities, and poverty alleviation projects are also allowed for investment under the PPP initiative, the circular said. According to the PPP guidelines, a project having investment above Tk 2.5 billion, excluding the ongoing capital for expansion, will be classified as a large project. A project with investment between Tk 250 million and Tk 2.5 billion, excluding the ongoing capital for expansion, will be considered a medium scheme. Projects with an estimated outlay of Tk 250 million each, excluding on-going capital for expansion, will be put in the small category.