Private Co's join hands with Centre for PURA

New Delhi, Oct 11 (INN): The initiative taken by the Ministry of Rural Development to kick start the Public-Private Partnership in rural infrastructure development has received enthusiastic response from the leading houses in the Corporate Sector. In all, Nine Private sector companies have bid for 15 pilot projects under the Provision of Urban Amenities in Rural Areas (PURA) scheme, a number larger than the envisaged number of pilots. This was disclosed by Ministry of Rural Development Secretary BK Sinha at a press conference here on Monday.

The nine companies that have been finally short-listed are in the area of infrastructure development with strong rural and community mobilization experience either directly of through their consortium partners. These companies include big names like Jindal Steel & Power Ltd, IL&FS Limited, Infrastructure Kerala Limited, Marg Ltd., Buldana Urban cooperative Society Ltd., A2Z Maintenance & Engg. Services Ltd., Megha Engineering Infrastructure Limited, Srei Infrastructure Finance Limited and SVEC. The selection has been done through an open competitive technical bidding process with rigorous qualification and evaluation criteria.

In the pilot phase, the private developer is given flexibility to identify and select the Gram Panchayat for undertaking PURA projects based on their familiarity with the area or past experience of working at the grassroots level.

However, as the consent of the concerned Panchayats and no objection from the state governments is mandatory, the selection would reflect the concurrence of all the stakeholders. It is expected that a scheme like PURA wherein all related schemes for rural infrastructure are being converged for a synchronized delivery for a period of 10 years in project mode shall maximize socio-economic impact. The average size of the projects is about Rs 100 crore with the total investment around Rs 1,300 crore. The average grant sought is 35 per cent and thus in all the projects would be about Rs 425 crore.

Mr Sinha informed media persons that since the total funds available to the Ministry during the 12th Plan are to the extent of Rs 248 crore, the number of pilot projects may need to be reduced. However the Ministry is confident that the additional funds would be organized in consultation with the Planning Commission and the Finance Ministry to take up all the projects in due course.

Funding for projects under PURA scheme would come from four sources: MoRD schemes, non-MoRD schemes, private financing and Capital Grant under PURA. Each individual PURA project cost and the eligible capital grant (subject to a maximum of 35 per cent of project cost) shall be determined on the basis of a Concept Plan and Detailed Project Report that would be appraised and approved by an inter-Ministerial Empowered Committee for the purpose.

Amenities and economic activities proposed to be provided under PURA include, (1)Amenities to be provided under MoRD Schemes, (2) Amenities to be provided under Non-MoRD Schemes and (3) Add-on Projects (Revenue earning, people centric projects).

These would include Water and Sewerage;;Construction and maintenance of Village Streets;Drainage; Solid Waste Management; Skill Development; Development of Economic Activities Village Street Lighting; Telecom; Electricity, etc. besides village linked tourism; Integrated Rural Hub; Rural Market; Agri Common Services Centre, Warehousing, etc.; and Any other rural-economy based project.

PURA was envisaged by former President of India APJ Kalam as a self-sustainable and viable model of service delivery in rural areas to be managed through an implementation framework between local people, public authorities and the private sector.

The scheme was re-configured after extensive consultation and research process with State Governments, private sector and multi-lateral development organizations like ADB. It was initiated as a pilot in Public Private Partnership (PPP) mode early this year when the Expression of Interest (EOI) evoked unprecedented response from the private sector for this untested and complex scheme, perhaps the first of its kind in the world. Ministry of Rural Development intended to launch about 8-10 pilots across the country.

Against this number, ninety five private entities expressed interest and these included some of the largest Indian corporate entities such as the IDFC, Tata Power, Reliance Industries, IL&FS, SREI Infrastructure etc. The scheme is poised to herald a paradigm shift in rural infrastructure development as the response of the private sector has surpassed the expectations of the Ministry of Rural Development.

PURA represents twinning of rural infrastructure development with economic re-generation activities. This is the first ever attempt at delivering infrastructure and amenities through Private Public Partnership in the rural areas. Involvement of the private sector, for the first time, in creation and management of amenities through a partnership with Gram Panchayats is an effort to provide a completely different framework for the implementation of rural infrastructure development schemes and harness private sector efficiencies in the management of assets and delivery of services.