Odisha Notifies New PPP Policy; User Fees To Be Levied For Infra Projects

Bhubaneswar: Almost a month after the Cabinet nod, the Odisha government has notified a new Public Private Partnership (PPP) Policy, 2023, aimed at accelerating the growth of PPPs in public infrastructure by attracting private investment.

It will be applicable to all infrastructure projects including roads, bridges, bypass, ports, harbours, railways, airports, irrigation, helipads, industrial parks, logistic hubs, water supply, tourism, sports, healthcare, education, inland waterways, power generation and transmission. User fees will also be levied to boost commercial viability of the projects and the amenability of private sector participation, the notification issued by the Finance Department said.

The user fee mechanism will guided by principles of cost recovery and acceptable return on investment to private sector, incentives for efficiency and willingness to pay for designing and deciding user fees, which is said to be critical to the success of PPPs as they incentivise project proponents to become more efficient.

The policy further said that projects with capital expenditure up to Rs 10 crore will be approved by the director of the PPP Cell of the state government, provided that these projects do not require any assistance from the Odisha Infrastructure Development Fund (OIDF) or the state Viability Gap Funding (VGF).

For proper monitoring of projects, the Empowered Committee on Infrastructure (ECI) headed by the chief secretary has been formed and it will approve the PPP projects from Rs 10 crore up to Rs 500 crore and for proposals more than Rs 500 crore. A PPP committee headed by the district collector will also be established at the district-level to coordinate and facilitate the implementation of such infrastructure projects.

According to the notification, the existing funding avenues and institutional structures such as District Mineral Foundation (DMF) and Odisha Mineral Bearing Areas Development Corporation (OMBADC) will be leveraged for improving infrastructure in the mining-affected areas and so also, VGF available under different schemes of the central government to attain the viability of PPP projects. The state government will also bridge the viability gap emerging from open bid to help in the implementation of an emergent infrastructure project, it said, adding that the scope of OIDF has also been extended and the fund can be used for taking up technical and financial pre-feasibility and feasibility studies, preparation of reports and bid documents and any other activities that need to be undertaken prior to offering proposed infrastructure projects.

(With inputs from PTI and TNIE)