Affordable user charge key to infrastructure projects: Experts

By Venkatachari Jagannathan | 20 Mar 2003

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Chennai: If the private sector wishes to succeed in infrastructure projects then user charges should be affordable for those residing in catchment areas. “To achieve this there is an urgent need to truncate costs drastically. We need to look at how costs could be cut,” said Ravi Parthasarathy, vice chairman and managing director, IF&FS.

Speaking at the Summit on Integrated Infrastructure Development (Suminfra 2003) organised by the Confederation of Indian Industry Southern Region (CII-SR) he also called for continuity and predictability of government policies for infrastructure projects to succeed.

According to Sachin Kerur, solicitor (international and energy division), Masons, UK, a law firm, a country legal framework should be transparent to provide investors the much-needed comfort. “It is better to have one comprehensive piece of legislation governing the build-operate-transfer (BOT) projects than several laws.”

Citing the Rs 27,000-crore hit taken by the Delhi state government while privatising the power distribution in the capital, Nasser Munjee, managing director and CEO, Infrastructure Development Finance Corporation (IDFC), said the vision and willingness of the political class to take hard decisions are important for infrastructure projects in the private sector to succeed.

“How does this benefit the citizens, is one question that should be used as the measuring rod while taking decisions relating to infrastructure projects,” he said. He also questioned the need for having several regulators instead of one regulator with proper systems in place.

While calling for close coordination among government-financial institutions-academic bodies to sort out the issues in core sector projects, Munjee said a cluster approach will be easier to implement in infrastructure development.

Referring to the Tamil Nadu chief minister’s announcement on the setting up of two power projects partnering with public sector power majors he said the intention of public-private partnership should be demonstrated in actual projects.

 

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