The government is clearly of the view that development of infrastructure is one of the key parameters for any economy to be the best in the world. The infrastructure sector was named as the fifth support pillar of the budget theme ‘Transform India’ and accordingly provided much needed impetus with an allocation of more than Rs 2,21,000 crore. Union Budget 16-17 once again brought infrastructure sector to the forefront of development through policy measures and substantial government spending.
The finance minister has announced major steps to re-vitalise Public-Private Partnerships (PPPs) which, as per the Kelkar Committee, are an important policy instrument to speed up the process of economic growth. Some of the important announcements
include the enactment of a Public Utility (Resolution of Disputes) Bill, framing of Guidelines for Re-negotiation of PPP Concession Agreements, and a new credit rating system for infrastructure projects. These measures will boost the revival of stalled projects and help bring the train back on track.
The Kelkar Committee report had reviewed PPPs in the infrastructure sector and suggested revival of the defunct proposal to establish 3PI to support such projects. However, no announcement was made in the budget. The government should strongly consider the need to revisit the same as it has the potential to accelerate the growth of the infrastructure sector.
For promoting the aviation sector, the government is planning to develop the existing unserved and underserved airports. This will improve regional connectivity. Foreign Direct Investment (FDI) norms were also eased for certain sections of the sector. Recently, the government had raised investment limit to 100% from the present cap of 74% in certain civil aviation sectors thereby allowing foreign general aviation charter operators and ground handling companies to set up base in India. There is a need to promote PPPs in this sector as per the recommendations of the Kelkar Committee. However, the budget has not addressed the issue of private participation. The government had earlier issued a draft National Civil Aviation Policy 2015 which deals with a number of issues. Hopefully, the finalisation of the policy will help transform the aviation sector.
16/03/16 Financial Express
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The finance minister has announced major steps to re-vitalise Public-Private Partnerships (PPPs) which, as per the Kelkar Committee, are an important policy instrument to speed up the process of economic growth. Some of the important announcements
include the enactment of a Public Utility (Resolution of Disputes) Bill, framing of Guidelines for Re-negotiation of PPP Concession Agreements, and a new credit rating system for infrastructure projects. These measures will boost the revival of stalled projects and help bring the train back on track.
The Kelkar Committee report had reviewed PPPs in the infrastructure sector and suggested revival of the defunct proposal to establish 3PI to support such projects. However, no announcement was made in the budget. The government should strongly consider the need to revisit the same as it has the potential to accelerate the growth of the infrastructure sector.
For promoting the aviation sector, the government is planning to develop the existing unserved and underserved airports. This will improve regional connectivity. Foreign Direct Investment (FDI) norms were also eased for certain sections of the sector. Recently, the government had raised investment limit to 100% from the present cap of 74% in certain civil aviation sectors thereby allowing foreign general aviation charter operators and ground handling companies to set up base in India. There is a need to promote PPPs in this sector as per the recommendations of the Kelkar Committee. However, the budget has not addressed the issue of private participation. The government had earlier issued a draft National Civil Aviation Policy 2015 which deals with a number of issues. Hopefully, the finalisation of the policy will help transform the aviation sector.
16/03/16 Financial Express
