Need regulatory framework for public-pvt model success: FM

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By Dhirendra Tripathi and Neha Arora, edited by Vandana Hingorani . 

Finance Minister Pranab Mukherjee today said the success of public-private partnerships in infrastructure requires a strong policy and regulatory framework to augment private sector investment. "Private investment is essential to supplement government effort, provide for greater accountability and efficiency...Private investors look for an assurance," Mukherjee said in his speech at an infrastructure sector event. He also said the biggest bottleneck to development in infrastructure is lack of access to power. The government aims to give "power to all" by 2012, but is actually far from achieving the target. While the country is plagued with technical and commercial losses in the transmission and distribution sector, the government has also fallen behind in achieving its capacity addition objective. In the current Five-Year Plan that ends 2012, the government had initially aimed to set up a capacity of 78,577 MW but now, at best, is expected to achieve 60,000 MW. He said the government has to ramp up spending on core sector, given that the need for increased spending has become "obvious" following the impact of the global slowdown on the Indian economy. "A coherent approach in infrastructure sector is an urgent necessity especially in the aftermath of the global financial slowdown," Mukherjee said. "After a period of relatively high growth, the developing countries were affected by the slowdown. In this scenario, ramped up infrastructure spending is potent and obvious," he said.

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