public private Partnership a stance in state.

 

PUBLIC PRIVATE PARTNERSHIP

Definition:

“Public-private partnerships involve collaboration between a government agency and a private-sector company that can be used to finance, build, and operate projects, such as public transportation networks, parks, and convention centers. Financing a project through a public-private partnership can allow a project to be completed sooner or make it a possibility in the first place. Public-private partnerships often involve concessions of tax or other operating revenue, protection from liability, or partial ownership rights over nominally public services and property to private sector, for-profit entities.”

 

The Government of Pakistan strongly supports PPP initiatives. From 1990 to 2019, Pakistan witnessed 108 financially closed PPP projects, with a total investment of approximately $28.4 billion. In early 2021, Parliament approved the amendments to the 2017 PPP Law, enacting the Public Private Partnership Authority (Amendment) Act 2021. This further strengthens the enabling legal and regulatory framework for developing and implementing PPPs, thereby promoting private sector investment in public infrastructure and related services.

 The Government of Pakistan has limited public sector funding available to cater to the country’s overall public infrastructure requirements and related services. To bridge this gap, the Government made a policy decision to tap private sector investments and expertise. Following this policy decision of the Federal Government in 2006, Infrastructure Project Development Facility (IPDF) - a Section 42 company registered under the Companies Ordinance, 1984 (now Companies Act 2017) functioning under the aegis of the Ministry of Finance - was established to facilitate the implementing agencies in developing and structuring their infrastructure projects on a Public Private Partnership (P3) basis.

 

The mandate of IPDF was supported by “Pakistan Policy on Public Private Partnerships” that was initially approved in 2007 by the Economic Coordination Committee (ECC). This was replaced with a revised Policy that was approved by ECC on 26 January 2010. The mandate of IPDF was limited to the provision of transaction advisory services and capacity building of the implementing agencies. Till 2017, IPDF successfully developed, structured, helped procure and implemented four (4) mega projects worth approximately PKR 140 Billion.

 

With the promulgation of the Public Private Partnership Authority Act (No. VII), 2017, IPDF was converted into a Public Private Partnership Authority (the, “P3A”). IPDF’s assets, employees and liabilities were transferred to the newly established P3A with an improved and enhanced regulatory mandate as given in the Public Private Partnership Authority Act, 2017 (the, “P3A Act”). The provisions of the P3A Act and functions of P3A are limited and extended to Federal Government line ministries and their infrastructure projects.

 

According to information available on the PPP Authority's official website, at the federal level, 47 PPP projects are in the pipeline across sectors out of the 105 PSDP+ portfolio federal projects.6 Additionally, the PPP Authority lists a number of 'early harvest' projects that it is assisting with, including:

 

The construction of the Sukkur Hyderabad Motorway (expected cost around US$1.2 billion);

The construction of the Sialkot Kharian Motorway (expected cost around US$225 million);

The construction of a teaching and research hospital;

The construction of an innovations ecosystem (science and technology park);

The conversion of a guesthouse located in Lahore (the provincial capital of Punjab province) into a hotel;

The creation of a mass transit facility in a major city, the Karachi Circular Railway; and

The modernisation of the current Karachi–Pipri Rail Track.7

Previous projects finalised by the IPDF include:

 

The overlay and modernisation of the Lahore Islamabad Motorway (investment of US$460 million), which has been in operation since 2016;

The construction of the Lahore Sialkot Motorway (investment of US$438 million), which is in operation now;

The conversion of an existing four-lane super highway into a six-lane Karachi Hyderabad highway (investment of US$430 million), which has been in operation since 2017; and

The construction of the Habibabad Flyover (investment of US$8 million), which has been in operation since 2014.8

 

 

Muhammad Arbaz Khan

Bs 6^th (morning)

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