Do you support the proposal to abolish PPPAC and make NITI Aayog the approval authority for public-private-partnership (PPP) projects in India? Give arguments.

According to current rules, PPP projects above Rs. 1,000 crore in value are sent to PPPAC and then to the cabinet for final approval. PPPAC was created in 2006 and is responsible for the appraisal of the PPP projects in central sector. In my view, the plan to make NITI Aayog approval authority for PPPs is a sensible move. This would hasten the project award process. However, there are certain things which must be kept in mind. Firstly, the DEA officers have been dealing with PPP projects for several years now and their expertise should not go in vain while making this reform.
Secondly, there is a need to have clear cut guidelines as recommended by Kelkar Committee Report. Thirdly, there is a need of proactive capacity building so as to have sophisticated contracting standards and sound dispute resolution norms. India is the largest market for PPPs and we need forward looking public policy.

Topics: GS-III: Effects of Liberalization On Indian Economy