Key factors and readiness perception indicators appraisal: Public-Private partnership in infrastructure development project in Bangladesh

Abstract

PPPs present a framework that –while engaging the private sector-acknowledge and structure the role for government in ensuring that social obligations are met and successful sector reforms and public investment achieved. PPPs present a number of recognized advantages for the public sector to exploit. These include the ability to raise additional finance in an environment of budgetary restrictions, make the best use of private sector operational efficiencies to reduce cost and increase quality to the public and the ability to speed up infrastructure development. The objectives of this study are: To identify key factors for influencing successful Public-Private Partnerships in infrastructure projects and to assess the PPP-readiness perception for PPP project development and implementation in Bangladesh. The objectives of this study were achieved via a comprehensive literature review, in-depth case analyses, interview survey with experts and finally data collection was conducted via a questionnaire survey with respondents having PPP knowledge. According to survey results, the most three attractive factors were: Solve the problem of public sector budget restraint, Transfer risk to the private partner and Facilitate creative and innovative approaches. In addition the most three negative factors were included: Lengthy delays because of political debate, a great deal of management time spent in contract transaction and Lack of experience and appropriate skills. From literature review and case studies, above mentioned attractive factors and negative factors were also reflected. Results obtained which also reflected that the most important driving forces leading to the adoption of PPP included: Shortage of government funding, Economic development pressure of demanding more facilities and Social pressure of poor public facilities. PPPs should only be adopted as procurement and implementation option if they are reasonably expected to deliver enhanced value for money over traditional methods.

Seventeen VFM measures in PPP were rated by the respondents. According to analyze the relationship of top five VFM measures ranked .These VFM measures included: Output based specification, efficient risk allocation, competitive tender. It is also analyzed the perceptions of respondents on the importance of seventeen factors contributing to successful delivery of PPP projects. The ranking showed that the top five success factors included: Favorable legal framework, political support, appropriate risk allocation and risk sharing, strong and good private consortium, commitment and responsibility of public and private sectors and government involvement by providing guarantee. The questionnaire was responded by the respondents from public and private sector that have the understanding the PPP environment in Bangladesh. By analyzing the perceptions of the PPP environment related to readiness it is possible to take action plan for mitigating the gap which is required for PPP projects development and implementation. Questions related to PPPs were qualitative in nature. The areas to which this question was focused include: Legal and regulatory provision, policy framework, capacity, project selection and contracting process, pose-selection and contracting process and social dimension