Role of Public private partnership in Infrastructure Financing: A study of GMR Hyderabad International Airport Limited - By sandhya Raama.

Chapter 1

Infrastructure refers to the physical facilities available to the citizens in a country. It includes roads, seaports, airports, electricity, gas, energy, water etc. Unless there is connectivity, well laid down infrastructure, it is not possible to attain speedy economic growth. According to 2006 report of United nations ESCAP 2 , Infrastructure is defined as the following:The expected definition of infrastructure includes transport (roads, railways, ports and airports), public utilities (electricity and water supply), public services ( fire service, flood protection, police), National services( the defence, monetary and postal systems and the legal and regulatory system) along with soft infrastructure, which denotes institutions that maintain the health and cultural standards of the population(Public education, health and social welfare). Along with the basic infrastructure, we have social infrastructure that usually refers to universities, schools, hospitals, prisons, public housing, community facilities, convention centers, and sports facilities. Another type of infrastructure referred to as disaster management infrastructure has been gaining more importance. In economic growth and development, infrastructure plays a very important role. If a country lacks good infrastructure facilities, it will hold back its economic development and if there are high infrastructure facilities in a country, that country will have links with all the different places of the world, thus fostering economic growth and development. The world economic forum in its 2006 report has mentioned infrastructure as one of the nine elements crucial to a countrys productivity and competitiveness. With the development of roads, ports and airports , connectivity within the country and outside the country increases the growth which fosters the economy. With the infrastructure development, there will be poverty reduction and employment thus increasing the income and standard of living of the people. Infrastructure development is crucial for developing countries to be on the world economic map. Meanwhile, developed countries are required to maintain their existing infrastructure and develop new infrastructure in order for their economies to remain competitive. With growing population in all the countries, there has been an increased demand for infrastructure in various areas of transport, telecommunications, water etc. This increase is attributed to the recognition of governments that sound infrastructure is a must to achieve economic growth and provide better quality of life for the people. With globalization, people are reaching out to different places thus accessing major such facilities such as ports, roads and airports, thus increasing the demand for infrastructure. There is

increase in the mobility levels associated with the increase in vehicle ownership, because of which more transport infrastructure development is a must. The cost incurred in transportation is high and sometimes cannot be afforded by everyone. For example, In India 3 , most of the vegetables and fruits get spoiled during transportation from villages to cities due to lack of proper transportation and the villages cannot afford to pay higher transportation costs. Information and communication technology infrastructure plays a important role in development of trade and business. Telecommunications links all parts of the world together and without communication, it will be difficult to communicate and to develop trade and business. These ICT tools are essential to stimulate developing economies and integrate them into world economy. Water is the elixir of life. Water is essential for industry, agriculture and for survival of human beings. As the population is increasing, the need for water is increasing which makes water infrastructure crucial for growth. Dams and reservoirs have to be constructed to ensure the sustainability of water resources and overcome scarcity problems. If there is insufficient infrastructure as it seen in most of the underdeveloped and developed countries, it keeps a large part of the population from obtaining safe water and decent sanitation. One of the crucial and of late becoming important infrastructure is Disaster management. This is because of the sharp increase in economic losses caused by natural disasters. One of the major disaster that had hit some of the asian countries is Tsunami. As most of the people lost their lives and property, as no government was prepared for this disaster and no precautionary measure was taken for this. Hence, this resulted in a greater loss. The reasons for increased infrastructure demand can all be gathered to main reason, which is that infrastructure drastically enhances the quality of life of communities. As the global competition pressure increases and to increase the economic growth, governments have to develop their infrastructure. Along with this, there is huge population growth, increased urbanism and higher income , there is an increased demand for infrastructure. Because of this, the cost of development of infrastructure has also increased. The age old infrastructure which is mainly built by governments decades ago shows the underdevelopment and is deteriorating. Because of all the above reasons, governments of different countries are forced to develop their infrastructure. However, as infrastructure projects are becoming more complex, the financing of the infrastructure projects is becoming more and more difficult. The cost incurred in these projects is almost billion and trillion dollars and is difficult to raise such a huge amount. To raise this amount , governments are finding innovative ways and they are emerging as a new asset class for investors, along side stocks, bonds and real estate. According to UNESCAP report(2006), Asias infrastructure was expected to spend $1 trillion between 2007 and 2012. In Asian and Pacific

countries, if investments in infrastructure continues at its current level, the gap between supply and demand could be $180 million per year 4. Thus, from the above discussion, we can conclude that infrastructure is very important for the countries for their economic growth and development. Infrastructure financing is very important as it involves huge amount of money and the government is not in a position to fund the entire project on its own. It uses different sources to raise funds and develop the infrastructure of the country. Need of the study:It was observed that most of the governments were building the infrastructure projects as it is the social responsibility of the governments to provide basic facilities to the people of the country. Whatever the sources of funds for the government were there, they became insufficient for development of infrastructure because of the growing population and urbanization and increasing demand for infrastructure. With globalization and invention of different modes of transport and communication, people started moving from places to places thus demanding better infrastructure. So the governments started outsourcing to private parties. Though there was lot of betterment in the development of infrastructure, it could not fulfill the basic responsibility of social welfare and taxes and tolls collected from public was also very high, thus increasing resentment among the public. So, the goverments decided that they would be also be the part of the project along with the private parties. This will enable the governments to provide better and improved infrastructure to the people and also fulfill the social responsibility and reducing disparities among the people, and reaching to all sections of the society. Thus, the concept of public private partnerships took shape and emerged into the most popular concept of financing infrastructure projects. Thus the need arises to take up this study.

Review of literature:Adel Azar & et.al1 in the article titled CSFs to manage risks in Energy infrastructure projects by Public private partnerships(2011) examined the critical success factors of public private partnerships risk management. The main objective of the study is to examine risk management in Public private partnerships. The study has used Q-Sort data for data analysis in which the data is collected through Q-Sort cards. In this study, it was found out that the knowledge management processes had a positive impact on risk management. Michael Hanna .f.Fin2 in the article titled Luring infrastructure(2011) has examined about the unlocking of the substantial wealth in the Australian Superannuation sector and using it to $700 billion infrastructure gap in Australia. The main objective is to examine how the funds should be invested in the superannuation sector. The study examines about the infrastructure in Australia and the Greenfield projects particularly public private partnerships and why importance is given to Greenfield when compared to brownfield projects. The study found out that the PPPs are typically led by investment banks and contractors and they attract Third party equity to support the projects.

Asieh Mansour & Hope Nadji3 in the research paper titled Performance characterisitics of infrastructure investments(2007) has examined the conceptual characteristics of infrastructure. The main objective of the study is the comparative analysis of infrastructure assets relative to other alternative and traditional assets. The study also examined the performance of infrastructure subsectors. William Streeter, Gersan R.Zurita et.al 4 in the article titled Public private partnerships: the next generation of Infrastructure finance(2004) has examined the prerequisites for a receptive PPP Debt market. The objective of the study about public private partnerships as the next generation of infrastructure finance. The study also examined and analysed the critique of traditional PPPs and the common myths concerning Public infrastructure finance. The study concluded that private banks are exploring the creation of infrastructure banks in select emerging market countries and the financial engineers from both the public and private sectors will create the next generation of PPPs. The study also concluded that a more efficient allocation of capital engages a broader set of participants and creates new incentives to enhance the capacity for infrastructure finance while promoting a more efficient delivery of municipal services. Darrin Grimsey and Mervyn K. Lewin5 in the book titled Public Private Partnerships: the world wide revolution in Infrastructure provision and project finance(2005) has a given an overview of public private partnerships. The authors laid an impetus for PPPs and on the quality and the range of infrastructure that has a profound impact on economic growth in addition to serving a public need. Mona Hammami & et.al6 in the working paper titled Determinants of Public Private Partnerships in infrastructure presented an empirical analysis of the cross-country and cross industry determinants of Public private partnerships arrangements. The study found out that PPPs tend to be more common in countries where governments suffer from heavy debt burdens and where aggregate demand and market size are large. The findings of the study also suggest that macroeconomic stability is essential for PPPs and also that private participation in PPP projects depends on the expected marketability, the technology required and the degree of Impurity of the goods or services. Hitendra Pillay & Greg Hearn7 in the article titled Public Private Partnerships in ICT for Education(2010) has examined the nature and significance of PPP and usage of PPP in Information-Communication technology(ICT)- supported education and training. The objective of the study was to examine PPPs for infrastructure development especially in ICT supported Education and training. The study also examined how PPPs play a vital role in e- Education and Social Development. The study concluded that it is the most challenging task for governments in Asia-Pacific countries for understanding what is entailed in PPPs and the creation of conducive environments for sustaining the interest of both public and private partners. It was concluded that knowledge, skills and expertise in developing, negotiating, implementing and monitoring projects and programs with partners that have competing agendas are crucial for the success of PPPs in ICT in education.

Manuj Ohri8 in the article titled Airport privatization in India- A study of different modes of infrastructure provisions examined the different modes of providing airport infrastructure in India. The main objective is to examine the financing, control structure and revenue accrual mechanism in each of the modes. The study analyses the airport infrastructure in India by benchmarking metrics i.e. Revenue based, profit based and input/output based metrics ) are computed against international airports. The study found out that the government should use innovative incentives to attract private participation and understand the importance of alternate revenue streams in making the airport projects feasible. The study concluded that the Indian airports are way behind foreign peers in terms of infrastructure and performance. To improve the growth and performance of airports, the government should have political will and also garner support for the ongoing initiatives taken for the airport. Rekha Jain, G.Raghuram and Rachna Gangwar 9 in the article titled PPP model of Indian Airports Lessons from Delhi and Mumbai airports concessions(2008) made an attempt to explain the airport concession models. The main objective of the study was to know the bidding process, concession model, and the lesson learnt from Delhi and Mumbai airport concessions. The findings of the study were that significant thought should be given to the Request for proposal including the Bid structure, constitution of committees and contingency planning especially if none or only bidder is qualified. It was concluded that the experience on concessioning of the Delhi and Mumbai airports raised a number of issues which require sensitive consideration. The study has also raised certain questions that would require attention before the concessioning of an airport is attempted again in the country. It was also concluded that India has managed to award long term concessions to private consortia something many countries in the world aspire to do. Ada KarinaIzaquirre & Supriya Prakash Kulkarni 10in the working paper titled Identifying Main Sources of funding for infrastructure projects with Private Participation in Developing Countries: A Pilot Study(2011) , examined the contributions to Public Private Initiative(PPI) investment in 2006-09 as defined by the PPI database from the private sector, the host country public sector and foreign official sources. The main objective of the study is the PPI investments, global trends and also to highlight the trends by sectors. The study also discusses trends of PPI investments by country Income groups and summarizes regional trends and trends by type of private participation. The study concluded that the private sector(Via private commercial banks and private sponsors ) was the primary funding source for new PPI/PPP projects. Public sources such as local public financial institutions, governments and donor agencies, also made important contributions. It was concluded that the mix of funding sources varied significantly across countries and sectors. Countries with strong public financial institutions(such as Brazil and India) relied on those institutions to fund a large share of the investment in PPI/PPPs. LowIncome countries depended on donors and government funding to finance an important share of PPI/PPPs projects. Most of the remaining countries relied mainly on private sources. Eduardo Engel, Ronald Fischer and Alexander Galetovic11 in the article titled the Economics of infrastructure finance: Public-Private Partnerships Vs Public Provision examined the economies of infrastructure finance, focusing on public provision and PPPs. The main

objective of the study is to show that project finance is appropriate for PPP projects, as there are few economies of scope and the assets are project specific. The study suggests that higher cost of finance of PPPs is not an argument in favor of Public Provision, as it appears to reflect the combination of deficient contract design and the cost cutting incentives embedded in PPPs. The study also examined the role of government activities in PPP financing and their consequences. The study concluded that PPPs affect the intertemporal government budget in much the same way as public provision. Gajendra Haldea12 in the article titled Public Private Partnerships in Infrastructure : A Paradigm shift has emphasized on the importance of Infrastructure for the Indian economy. The main objective of the study is discuss about the infrastructure and the role of PPPs in infrastructure. The study discuss about some of the major initiatives taken by the Government of India in pursuit of an accelerated growth of infrastructure development across sectors. The study concluded that competitive private participation in all the infrastructure sectors would bring quantum improvements in near future. Michael .J.Garvin13 in the article titled Public Private Partnerships for infrastructure: Forging ahead in America(2009) examined the use of PPP as a popular strategy for infrastructure development world wide. The main objective of the study is to trigger dialogue about PPPs and how they might improve Americas infrastructure assets. The conclusion of the study is that US should reduce knowledge gap with the international community else the gap that may develop will present challenges that will be more difficult to handle. H.W.Alfen & et.al14 in the position paper titled structured approach for public private partnership infrastructure research has focused their research on a macro level of infrastructure services provision. The main objective is to study about user financed Vs Public institutional financed infrastructured projects and also aimed to develop a scheme or pattern for evaluation of all types of infrastructure services provision. The study concluded by distinguishing an operationalisation model and an industry framework. The operational model focused on project specific questions regarding planning, financing implementation and operation. The cultural framework consists of country-specific , sector specific and project specific characteristics. Mrutyunjaya Bellad15 in the article titled Public Private Partnerships in Health Research : Experiences from a community based research project in South India(2005) has presented an overview of a partnership model between a private academic institute , Jawaharlal Nehru Medical college(JNMC), and the public sector health care delivery system for conducting an ongoing global network for womens and childrens health research project being implemented in primary health center areas of Belgaum district, Karnataka. The objective of the study is to know about PPPs in the health research. The conclusion of the study is that PPP has demonstrated the success of collaboration between the larger public sector health system and the private sector research system. The study showed that when PPPs are used appropriately, they contributed to the cost effective improvement of individuals and populations health. Robert.G.Choller16 in the article titled Public Private Parnerships(1979)examined the origin and evolution of PPPs in the neighbourhood. The main objective is to study about the problems

faced by the government in providing infrastructure to the people and how they approached the private parties to develop infrastructure along with public parties. The conclusion of the study is that work-study programs for high school students, play a vital role in the majority of urban areas. Stefania Scandizo18 in the discussion draft Public Private Partnerships and the infrastructure challenge in Latin America(2009) gave a brief overview of developments in infrastructure in Latin America and the reasons for reduced infrastructure development in the region. The objective of the study is to discuss the challenges facing infrastructure development and financing in the region and also considers the different sources of financing available for infrastructure in Latin America. The study also discusses the role of regional cooperation in infrastructure. The conclusion of the study is that it focused on the need to expand infrastructure investment in the region through a combination of increased public spending, improved PPPs, new source of financing and regional cooperation. Fred Becker and Valeria Patterson19 in the article titled Public Private Partnerships: Balancing Financial Returns, Risks and Roles of the Partners(2005) examined the interrelation among financial returns, Financial risk and roles of the partners in public private partnerships formed to provide local and state government functions. The main objective is to study a balanced model of structuring PPPs for purposes of comparison and discussion. The study also examined to determine the social outcomes of the functional category, the general degree of financial risk and return that would normally be expected for such ventures, the prevailing nature of managerial involvement of both parties in the partnership and the degree of conformance with the balanced model of structuring PPPs. It is argued that the more the PPPs arrangement deviate from the balanced structured model, the greater the burden on decision makers to demonstrate that an overriding social purpose exists that justifies that deviance. David Hall20 in the summary paper titled Public Private Partnerships(2008) examined the concept and the growth of PPPs. The main objective of the study is to examine European Union Law And Policies in relation to PPPs and discussed about claims and myths about PPPs, Evaluated PPP Proposal and explained about the alternatives to PPPs. Uttara Chauhan & Niraj Lal21 in the article titled Public Private Partnerships for Urban Poor in Ahmedabad: A slum Project (1999) examined public private partnerships for the development of the urban poor in Ahmedabad. The main objective is to study the reasons that impede PPPs and also the tardy progress that the central and state governments have made in providing housing and employment to the urban poor. The study concluded that the tardy progress made by the government , raised doubts about its promise of building ten lakh free houses for slum dewellers in Mumbai and also Jawahar rogar Yojana and employment Guarantee schemes failed to make an impact on the unemployment scenario. Katharine.C.Lyall22 in the article titled Public Private Partnerships in the Carter Years (1986) has examined the origins and evolution on Public Private Partnerships. The main objective is to study the evolution of PPPs in Carter administration. The conclusion of the study is that PPPs across the country i.e.US were impressive. The partnerships as the policy tool have

been more successful in urban development by addressing more social needs , and also PPPs have become substantially more sophisticated in their organizational form and in their legal capacity to formulate financial deals, overseas performance and manage projects. Fernando Murillo23 in the article titled Private Public Partnerships , the compact city and social housing: Best Practices for whom?(2001) has examined the case study of Casa Propia(Own home) Programme of the Buenos Aires City government. The main objective of the study is know about the experience in Argentina about the Casa Propia programme and suggested that in the absence of consolidated social contingency networks has resulted in a housing programme that emphasizes on financial viability over social and environmental concerns. The conclusion of the study is that programme represents a failure to predict that better off social groups would be the main beneficiaries of the projects and is to establish a state subsidy system founded on social equity rather than entirely on current understandings of financial sustainability. Vinay Sharma and Piyush Seth24 in the paper titled Effective Public Private Partnership through E-Governance Facilitation proposed the utilization of E-Governance as a tool to effectively establish Public Private Partnership in the case of provision of health to the rural and the poor population of India with special reference to the state of UP. The paper gives the introduction of the strategic component in dissipation of the health care services in and through the existing system itself. The conclusion of the study is that partnership of public administration and private enterprise will not only fill up the gaps in the spread and prevalence of infrastructure but also, utilizes to remotivate the human resource responsible for executing the process of development with the help of proposed model. Harry Anthony Patrinos, Felipe Barrera-Osoria & Juliana Guaqueta25 in the book titled the role and impact of Public Private Partnerships in Education, gave a detailed review of rigorous evaluations and guidelines on how to create successful PPPs. The book shows how this approach can facilitate service delivery, lead to additional financing, expand equitable access and improve learning outcomes. The book also discusses the best way to set up these arrangements in practice. Dr.Sukumar Chand, Aneesh Saraiya & V.Sridhar26 in the paper titled Public private partnerships in Indian Diary Industry- Initiating white Revolution-II emphasized the need for private sector investments get accelerated in dairy industry. The main objective of the study was to examine and analyse the dairy industry in India. A thorough analysis of the existing government schemes for the dairy sector which showed that the government patronage to cooperative societies and small farmers has been fostering growth in the sector to some extent even though there are gaps in terms of maximizing the value involved in the entire chain. The conclusions of the study are that lack of sufficient landholding for cultivation for green fodder, limited resources leading to absence of collaterals to offer, inability to generate own contribution, lack of technical skills to make the enterprises more viable and lack of financial resources to purchase the inputs are some of the constraints in financing small dairy farmers. It is suggested that the banks and other financial institutions need to play the proactive role in providing easy and user friendly credit to the end users of each component viz production

, procurement, processing and distribution across the milk value chain through development of area specific schemes and redesigning of their financial products. This will also enhance the agri advances portfolio and the customer base of the commercial banks. For the effective delivery of financial solutions (including insurance), strategies , kisan white card, special schemes, redesigning of livestock insurance, awareness campaigns etc. can be implemented by banks and other national bodies for the benefit and development of the dairy sector. Darja Reuschke27 in the article titled Public Private Partnerships in Urban development in the United states examined partnership approaches in Urban renewal and urban development projects in the US. The objective of the study is to examine how important PPPs have been in City planning and how they have affected urban revitalization in the US. The study also discuss the reasons for Public Private Partnership building in the US while taking social, political and economic circumstances. The study also defines distinct types of partnerships that have developed since their emergence in 1950s and particularly in 1980. World Bank draft by Price water coopers28 titled Infrastructure public private partnership financing in India (2007) examined the financing sources for PPP infrastructure. The main objective of the study is to identify the issues and constraints to PPP infrastructure financing and to analyse the financing of PPP in India and also to identify changes required to reduce and ease the identified constraints. The study discussed the sources of the finance and also questionnaire and interviews were used as the tools for eliciting information about PPP infrastructure. Gaurav Dwivedi29 in the research book titled Public Private Partnerships in water sector: Partnerships or Privatization ?(2010) discusses the various aspects of PPPs and the reasons for regarding PPPs as the major approach for the infrastructure development in the country, the circumstances that lead to the change in approach from direct privatization to public Private partnerships and also about the current status of PPP projects in India. The book also investigated PPPs from different aspects and analyses the arguments given in favour of PPPs , the structural issues with PPPs and the larger governance issues associated with PPPs like transparency, peoples participation, access to information and regulation. It also studied the impact of the PPPs on some of the social obligation issues like the responsibility of provision, service delivery and equity when the private sector is involved in delivery of public services. It provides an overview of various projects and policies that are being implemented to promote PPPs and finally examines the other models that are being pursued in various parts of the world to provide better public services. Satyam Shivam Sundaram30 in the article titled Formation process of public private partnership in transport infrastructure in India. has explained about the role of PPP in the formation process in transport infrastructure. He explained that the PPP had a great role in development and analysed that the formation process of PPP has been found to be critical in deciding the outcomes of a PPP project. He concluded that contractual arrangements have been at the core of the PPP process in India. He suggested that an attempt is made to create strong relational arrangements along with the contractual arrangement and this would lead to higher rate of success in PPP.

Christian Tabi Amponsah 31 in the article titled Using Multi- Criteria decision making to determine the critical success factors for procurement of capital under PPPS.made an attempt to study which revealed that owner satisfaction with the delivered project, adherence to schedules/budgets/quality/safety/environmental controls and appropriate funding mechanisms were predicate while lack of legal encumbrances, clearly defined project mission and adequate planning and control techniques were also commonly expected. Tamal Datta Chaudhuri 32Methods of financing road project in India(2007) has examined that when road construction was under the purview of the government, roads used to be financed out of budgetary allocation. However, road construction has been privatized in India in recent years and the quality of roads has improved significantly. He analysed that circumstances in which the private sector has come forward in road construction, and also examined and analysed the financing structures that have been observed in India. Fumitoshi Mizutani. Tomoyasu Tanaka 33 in the article titled productivity effects and determinants of public infrastructure investment. aimed to investgate three important issues whether or not public infrastructure contributes to production in the private sector, Whether or not political economy factors such as political situation affect the allocation of public infrastructure investment,and what the governments investment behaviour is. It has concluded the following: 1) Public capital contributes to productivity, 2) the investment behavior of both government is efficiency-oriented for private productivity and for the capital stock level, 3) a substitute of public capital investment between the national and prefectual government can be found, 4) there is a clear political factor in the national governments public investment function, and 5) the availability of national government grants for the construction of infrastructure boots investment among prefectural governments. Ranjan Agrawal, Aayushi Gupta and M C Gupta 34 in the article titled Financing of PPP Infrastructure projects in India: Constaints and Recommendations.has explained that PPP structure are typically more complex than the traditional public procurement projects, and their complexity is due to the number of parties involved and the mechanism used to share the risk. The study concluded that India is facing large financing gap, which can be bridged only by active private participation in building the necessary infrastructure. Increased private financing for infrastructure on a sustained basis will require governments proactive role and policies to provide widespread reforms in infrastructure that will go beyond the financial sector. Ajay Sagar35 in the article titled Infrastructure and Project Financing. has explained that lack of adequate infrastructure capacity in Asia pacific has hindered development and led to a consensus that private investment including foreign investment and reforms are required. There is a need to shift to a new best proactive models for infrastructure development by creating public private partnerships. Bibi Ishrat Jahan36 in the article titled Public private partnership in Uttar Pradesh Health Care Delivery System-UPHSDP as an Initiative. has tried to find out the primary reason to encourage public participation in health care delivery system in uttar Pradesh and the study also aims to analyse UPHSDP-a world bank project.

Oluoch & Wainaina37 in the article titledEffectivess of Public Private Partnerships in Infrastructure Financing. has explained that it is crucial in order to ascertain from empirical assessments the key factor that determines and enhances the effectiveness of PPPs in financing infrastructure. It is also found that the project technical feasibility is critical. The success of the PPP contract depends on the accuracy of the technical feasibility process. This is coupled with the nature of the prevailing legal framework since the success of the PPPs in countries including France, England and South Africa seems to stem from among other factors, the supportive legal framework. Geoffrey Payne 38Research on Public Private Partnerships in urban land development.has explained that with the rapid expanding cities of developing countries the demand for the land is without historical precedent. Many metropolitan centres accommodate more than ten million and are increasing by up to 1000 people a day, while many smaller cities are doubling in population every decade or less. It has been estimated that in India alone, approximately 600,000 hectares, or enough to accommodate the projected increase. Dr. Suhaiaza Ismail and Shochrul Rohmatul Ajija 39 in the article titled Critical Success Factor of Public Private Partnerships Implement in Malaysia. has identified the critical success factors (CSFs) of PPP implementation is considered to be crucial there. Firstly it was examined the importance of the CSFs of PPPs. Secondly, it was intended to identify the difference concerning the importance of the CSFs between the public and private sectors. Thirdly, comparison of the importance of the top CSFs for PPP implementation in Malaysia with three other countries that have adopted PPP. It was concluded that good governance, commitment of the public and private sectors, favourable legal framework, sound economic policy and availability of finance market between the public and private sectors, there were no significant differences in the perception of the public and private sectors concerning the importance of the CSFs except for a few factors, there were mixed results concerning the comparision of CSFs between Malaysia and three other countries. Nur Alkaf Abd Karim. 40 in the article titled Risk Allocation In Public-Private Partnerships Project: A Review On Risk Factors.has presented in this paper the reviewing of the risk factors of PPP construction project by mapping previous research works on PPP projects around the world. The matrix of the mapping gives the frequency of factors that are considered the risk allocation of PPP project. The risk factors are clustered into 10 groups namely: Political, Construction, Legal, Economic, Operation, Market, Project selection, Project finance, Relationship and Natural factors.Result shows that the highest score frequency factors are change in law,delay in project approvals & permits and land acquisition. K.M.Mittal and Vivek Mittal 41 in the article titled Public Private partnerships and social infrastructure has made an attempt to review a set of public private partnerships models relevant for infrastructure development and review problems and issues in different areas of social infrastructure including education, healthcare, women empowerment, care of the elderly etc.

With the help of select case studies based on different public private partnerships models and information and communication technologies. He concluded that for the success of PPP models, it is necessary that public capital( tied in with government control) and private capital (tied up with private sector efficiencies and incentives) have to be utilized in most effective manner with the minimum of red-tapism or adhocism. He also suggested that for best operating results and resolving day to day conflicts, regulatory authority such as AICTE for technical and management education projects, MCI for healthcare projects or TRAI for telecom projects play very useful role. PPPs need facilitative environment of independent regulatory authorities that help resolve conflicts among stakeholders. HardCastle.c., Edwards P.J. & et.al 42 in the article titled Critical success factors for PPP/PFI projects in the UK construction industry : A factor analysis approach has made an attempt to study about the Critical success factors (CSF) of PPPs in UK which are increasingly used in public facilities and services provision, through private finance initiative. He has used Factor analysis to examine the relative importance of Eighteen CSFs for PPP/PFI in UK construction projects. He concluded that the CSF of political support lies outside these principal factor groupings for PPP/PFI projects in the UK and like technology transfer, is more relevant to projects undertaken in developing countries. Ales Hojs, Champika Liyange and Alenka Temeljotov-salaj 43 in the article titledAnalysis of Critical success factors for road projects in Slovenia made an attempt to identify the factors and expectations which are most important for the decision to start a project under PPP procedure and verify the consistence of these expectations with existing law regulation and investigate the benevolence of Slovenian economic environment for the models of PPP. He concluded that in these days of financial crisis , the state budget would be more and more reduced and to find a private investor and make a win-win solution for both the sides (private & public) could be a goal. He suggested that to achieve this goal, the Slovenian government need tools and models for relevant decisions. Kathleen Brown 44 in the article titled Are Public private transactions the future of infrastructure finance has emphasized that PPPs are the future of infrastructure finance and PPPs will become a permanent fixture in the infrastructure finance landscape. During the study, it was found that there was growth in the PPP market and has been exceptionally strong, and there is every reason to believe that it will continue in future. It was concluded that PPPs a very real and practical solution to many of local municipalities transportation funding crisis. Nagra JS 45 in the article titled Public private partnership :- A case study of the MelakaManipal Medical college has made an attempt to study the partnership of Melaka- Manipal Medical college under PPP. He concluded that it has been a very rewarding experience to work and good governance and an enabling environment have allowed for a trickle down effect. PPP facilitates excellent work relationships allowing for a participatory process and the regulatory process is positive with the correct focus on quality.

Fan Zhai 46 in the article titled The Benefits of regional infrastructure investment in Asia: A Quantitative exploration made an attempt to frame a scenario for infrastructure development in the region and estimated the external effects of infrastructure investment in the region and estimates the external effects of infrastructure investment. It also assesses quantitatively the economy wide welfare effects of developing regional infrastructure in Asia, using a global computable general equilibrium model. The results of the study reveal that developing Asian economies would gain significantly from the expansion of regional infrastructure in Transport and communication. Clive Harris 47 in the article titled Private participation in infrastructure in developing countries : Trends, Impacts and policy lessons has studied the trends in private participation in infrastructure in developing countries and the factors influencing it. He also examined whether infrastructure provision has benefited from private sector participation. He assessed the impact it has had on the delivery of infrastructure services, and whether there been negative consequences for other important social goals, such as equity. He also examined the key areas requiring attention if private participation is to make a sustainable contribution towards the provision of infrastructure services, particulary for poor people. U.S.Pant 48 in the article titled Relevance of PPP in Public construction has presented this paper in the international conference in New Delhi :150 yrs of CPWD and made an attempt to explain PPP and why PPP should be implemented in place of Public systems. He also explained types of PPPs and benefits of it. Nilufer Akhter Khanom 49 in the article titled Conceptual issues in defining PPPs aimed to explore the conceptual issues associated with defining PPPs. Several gaps were identified in different conceptual issues of PPPs. It was concluded that PPP is viewed in different approached, and these include as a tool of governance and management, as a tool for financial arrangement as a development strategy and also as a language game. Rajiv B.Lall And Ritu Anand 50 in the article titled Financing infrastructure has explained the need for infrastructure financing and different sources of financing. It has also explained that banks played a vital role in financing and for any private investment, the financing source was through special purpose vehicle. Along with banks, the insurance sector dominated by the LIC, has also increased its financing of infrastructure. It was explained that various measures can be taken to facilitate the entry of financial investors in infrastructure as far as equity capital is concerned. Some of the decisive changes are that banks need to raise additional capital in order to avoid sector concentration risk. It was also suggested that to make the syndication of loan more effective, appraisal capacity needs to be strengthened in more banks and bank consolidation could also ease the exposure constraint somewhat for individual banks, although consolidation has not taken off so far despite much talk and a few attempts at merging public sector banks. Finally it was suggested that swap market development is required to facilitate term transformation and hedge interest rate risk. It was concluded that the bank dominated financial system has been able to step up and meet the needs of the first wave of private investment in infrastructure in a fast growing credit environment. It was also concluded that there is no substitute to improving the functioning of domestic financial system and certain mechanisms are to be created to address the problem of

mismatched assets and liabilities in banks and NBFCs lending to infrastructure and the challenge of distributing risks more widely across the domestic financial system so that they do not accumulate in a handful of banks and specialized NBFCs. HSI-KAI Cheng 51 in the article titled Lessons Learned from BOT infrastructure development in TAIWAN : A case study of the Taiwan High speed Railway (THSR) project has presented issues and lessons learned from the project. It was explained that the BOT model encourages the participation and direct investment of the private sector in long term governmental infrastructure projects. This study talks about the Taiwan High speed Railway Project, which may be the largest scale BOT project in the world was designed to be a modern model of PPP. It was explained that implementing this project has not only forced Taiwans government to examine and modify its existing legal and administrative institutions in response to BOT projects, but it has also challenged both the public and private sectors to learn to operate in a highly dynamic administrative and legal environment. Lance Bennett & Philip.N.Howard52 in the article titled Evolving Public Private Partnerships: A new model for E-Government and E-Citizens examined an approach aimed at digital inclusion through PPP that give citizens online access to government services and programs. The Microsoft partnerships for technology access initiative developed a PTA model which involves understanding the attributes of the second wave of technology adopters. The paper examined the model, assessed its assumptions and compared it with earlier methods for stimulating technology access in both developed and less developed countries. Rien Wagenvoort, Carlo de Nicola and Andreas Kappeler 53 in the article titled Infrastructure finance in Europe: Composition, Evolution and crisis impact(2010) made an attempt to compile comprehensive data on infrastructure finance in Europe. The study decomposed infrastructure finance by institutional sector(I.e Public vs Private) into its main components, which consisted of traditional public procurement, project finance and finance by the corporate sector, and analysed how the roles of the public and private sectors in financing infrastructure have evolved over time especially during financial and economic crisis. The conclusion of the study is that in contrast with government finance that is slightly up, private finance, in particular project finance through PPPs has fell down substantially during the financial and economic crisis, reversing the longer term trend of more private and less public financing of infrastructure. Georg Inderst 54 in the article titled Infrastructure as an asset class(2010) reviewed concepts, market developments and empirical evidence on the risk-return and cash flow profile, and the potential for diversification and inflation protection in investor portfolios. The study also analysed the historical performance of infrastructure funds. The study concludes that there is no proper financial theory to lack the proposition of infrastructure as a separate asset class and infrastructure assets are very heterogenous. The study suggests an alternative proposition that treats infrastructure simply as a sub asset class or particular sectors, within the conventional financial vehicle such as listed and private equity, bonds etc. Florian Bitsch, Axel Buchner & Christoph Kaserer 55 in the article titled Risk , Return and cash flow characteristics of infrastructure fund investments(2010) analysed the risk, return and

cash flow characteristics of infrastructure investments by using a unique dataset of deals done by private equity like investment funds. The findings of the study indicate that returns could be influenced by the regulatory framework as well as by defective privatization mechanisms. Conclusion:From the above study, it was found that most of the studies were based either on Public private partnerships, impact of critical success factors, lessons learnt from the ppp experience etc. But there were no studies on the infrastructure financing and role of ppp in infrastructure financing. This study is taken to fill up this gap. Objectives of the study:The following are the major objectives of the study :1.To highlight the importance of Infrastructure in the economic spear of the world. 2.To study the need for public private partnership . 3.To examine the financing of Public private partnership in India 4.To Evaluate the performance of Public private partnership in India. 5.To analyse the performance of Hyderabad International Airport Limited. Hypotheses of the study:The following are the hypotheses framed for the study. 1.PPP do not have any impact on the development of ancillary industries and employment generation. 2.PPP do not have impact on economic, environmental and social aspects of the country. 3.PPP do not have a profound impact on economic and social progress of the country. 4.Infrastructure projects do not have impact on different factors affecting the country. 5.Financing structures and techniques do not play a vital role in the infrastructure PPP Projects 6.Risk Management factors do not have a major impact on PPP infrastructure projects. 7.Financing techniques do not enhance the infrastructure facilities under PPP mode. 8.Indicative performance measures do not have an impact on the performance of GMR HIAL. 9.Infrastructure projects do not have any impact on the sustainability . 10.PPP of GMR HIAL has not contributed in cost effectiveness aspect of AP. 11.PPP of GMR HIAL is not a successful partnership. 12.PPP do not have direct and indirect economic impact . Data Collection:The data is collected through different sources. Primary data is collected through a well structured questionnaire which consists of questions about Public private partnerships , infrastructure financing, critical success factors and risk factors of PPPs. The questionnaire contains different types of questions. Some are open ended questions while some are dichotomous questions and some are based on 5-point likert scale. The questionnaire will be administered to project manager, owners, contractors, engineers etc.

Secondary data is collected from articles, Annual reports of GMR HIAL, magazines , journals, websites of Public private partnerships, world bank , airport aviation etc. Scope of the study:As the study is mainly concerned with infrastructure financing and role of Public private partnerships, the scope is confined to the study of public and private infrastructure financing. The study is confined to public and private partnerships and their role in infrastructure financing. The study is confined to the evaluation of financial performance and social cost benefit analysis of GMR Hyderabad international airports limited. Period of the study:The period of the study is five years. i.e.2008 to 2012.

Chapterisation:The study titled Role of Public private partnerships in infrastructure financing: A study of GMR Hyderabad international airport limited is organized into seven chapters. Chapter-1 Provides Introduction to the study. It defines Infrastructure , types of Infrastructure, Increased demand for infrastructure and importance and reasons for infrastructure. This chapter also highlights the need of the study, research methodology adopted, scope and limitations of the study. Chapter-2 titled Overview of Infrastructure in India presents the different infrastructure in india. It also discuss the development of infrastructure in india and the incentives and schemes taken up by the Indian Government to develop the existing infrastructure to world class infrastructure. Chapter-3 titled Evolution of Public private partnerships in economic development presents types and forms of partnerships,. It identifies different types of risks and risk analysis in PPP infrastructure projects. payment mechanism, role of PPPs in infrastructure financing, PPPs in infrastructure in world context, PPPs in infrastructure in Indian context, and critical success factors governing PPPs. Chapter-4 titled Infrastructure Financing through Public Private Partnerships in India(AP) presents different types of financing through different mechanisms and financing of ppps especially AP. Chapter- 5 titled Financing of GMR HIAL presents the analysis and evaluation of GMR HIAL financial statements and also presents the mechanisms adopted by GMR in financing HIAL.

Chapter-6 titled The performance of GMR HIAL analyses the performance of GMR hial through statistical tools. Chapter -7 titled Summary,Findings and Conclusions deals with the findings, conclusions and suggestions and areas for further research. Last section deals with Bibliography, appendices and annexures. References:1.Adel Azar & et.al CSFs to manage risks in Energy infrastructure projects by Public private partnerships(2011). 2. 2.Michael Hanna .f.Fin Luring infrastructure(2011) 3.Asieh Mansour & Hope Nadji Performance characterisitics of infrastructure investments(2007) 4. William Streeter, Gersan R.Zurita et.al Public private partnerships: the next generation of Infrastructure finance(2004). 5. Darrin Grimsey and Mervyn K. Lewin Public Private Partnerships: the world wide revolution in Infrastructure provision and project finance(2005). 6. Mona Hammami & et.al Determinants of Public Private Partnerships in infrastructure 7. Hitendra Pillay & Greg Hearn Public Private Partnerships in ICT for Education(2010). 8. Manuj Ohri Airport privatization in India- A study of different modes of infrastructure provisions 9. Rekha Jain, G.Raghuram and Rachna Gangwar PPP model of Indian Airports Lessons from Delhi and Mumbai airports concessions(2008) 10. Ada KarinaIzaquirre & Supriya Prakash Kulkarni Identifying Main Sources of funding for infrastructure projects with Private Participation in Developing Countries: A Pilot Study(2011) , 11 Eduardo Engel, Ronald Fischer and Alexander Galetovic the Economics of infrastructure finance: Public-Private Partnerships Vs Public Provision 12. Gajendra Haldea Public Private Partnerships in Infrastructure : A Paradigm shift 13. Michael .J.Garvin Public Private Partnerships for infrastructure: Forging ahead in America(2009). 14. H.W.Alfen & et.al structured approach for public private partnership infrastructure research 15. Mrutyunjaya Bellad Public Private Partnerships in Health Research : Experiences from a community based research project in South India(2005) 16. Robert.G.Choller Public Private Parnerships(1979). 17. W.Lance Bennett & Philip .N.Howard Evolving Public Private Partnerships : A New Model for e-Government and e-citizens 18. Stefania Scandizo Public Private Partnerships and the infrastructure challenge in Latin America(2009) 19. Fred Becker and Valeria Patterson Public Private Partnerships: Balancing Financial Returns, Risks and Roles of the Partners(2005) 20. David Hall Public Private Partnerships(2008) 21. Uttara Chauhan & Niraj Lal Public Private Partnerships for Urban Poor in Ahmedabad: A slum Project (1999). 22.Katharine.C.Lyall Public Private Partnerships in the Carter Years (1986).

23. Fernando Murillo Private Public Partnerships , the compact city and social housing: Best Practices for whom?(2001). 24. Vinay Sharma and Piyush Seth Effective Public Private Partnership through E-Governance Facilitation 25. Harry Anthony Patrinos, Felipe Barrera-Osoria & Juliana Guaquetathe role and impact of Public Private Partnerships in Education 26. Dr.Sukumar Chand, Aneesh Saraiya & V.Sridhar Public private Partnerships in Indian Diary Industry- Initiating white Revolution-II 27. Darja Reuschke Public Private Partnerships in Urban development in the United states 28. World Bank draft by Price water coopers Infrastructure public private partnership financing in India (2007) 29. Gaurav Dwivedi Public Private Partnerships in water sector: Partnerships or Privatization ?(2010). 30.Satyam Shivam Sundaram Formation process of public private partnership in transport infrastructure in India. Ph.D thesis Submitted to India Institute of Management Ahmedabad.2009. 31.Christian Tabi Amponsah Using Multi- Criteria decision making to determine the critical success factors for procurement of capital.Proceeding of the International Symposium on the Analytic Hierarchy Process 2011. 32.Tamal Datta Chaudhuri Methods of financing road project in India. P .g no 48-55. The IUP Journal of infrastructure, Vol. VII, No.1,2009. 33.Fumitoshi Mizutani. Tomoyasu Tanaka productivity effects and determinants of public infrastructure investment.Graduate School of Administration, Kobe University.Japan 2006. 34.Ranjan Agrawal, Aayushi Gupta and M C Gupta Financing of PPP Infrastructure projects in India: Constaints and Recommendations.P.g no 53-57.The IUP Journal of infrastructure, Vol. IX, No.1, 2011. 35.Ajay Sagar Infrastructure and Project Financing.Global Infrastructure Report of Project Finance International Magazine, 2006. 36.Bibi Ishrat Jahan Public private partnership in Uttar Pradesh Health Care Delivery System UPHSDP as an Initiative.ICSSR Teacher Fellow, GIDS, Lucknow. 37.Oluoch $ Wainaina Effectivess of Public Private Partnerships in Infrastructure Financing. 38. Geoffrey Payne Research on Public Private Partnerships in urban land development. The management of Sustainable Development in Fast Growing Urban Areas,to be held at the University of Wales, Caradiff,29-31 March 1998. 39.Dr. Suhaiaza Ismail and Shochrul Rohmatul Ajija Critical Success Factor of Public Private Partnerships Implement in Malaysia. International Islamic University, Malaysia. 40. Nur Alkaf Abd Karim. Risk Allocation In Public-Private Partnerships Project: A Review On Risk Factors.Published by: Universiti Tun Hussein Onm Malaysia and Concrete Society of Malaysia. 41.K.M.Mittal and Vivek Mittal Public Private partnerships and social infrastructure 42. HardCastle.c., Edwards P.J. & et.al Critical success factors for PPP/PFI projects in the UK construction industry : A factor analysis approach 43. Ales Hojs, Champika Liyange and Alenka Temeljotov-salaj Analysis of Critical success factors for road projects in Slovenia 44. Kathleen Brown Are Public private transactions the future of infrastructure finance 45. Nagra JS Public private partnership :- A case study of the Melaka-Manipal Medical college

46. Fan Zhai The Benefits of regional infrastructure investment in Asia: A Quantitative exploration 47. Clive Harris Private participation in infrastructure in developing countries : Trends, Impacts and policy lessons 48. U.S.Pant Relevance of PPP in Public construction, paper presented in international conference of CPWD-150 years. 49. Nilufer Akhter Khanom Conceptual issues in defining PPPs 50. Rajiv B.Lall And Ritu Anand Financing infrastructure 51. HSI-KAI ChengLessons Learned from BOT infrastructure development in TAIWAN : A case study of the Taiwan High speed Railway (THSR) project. 52. Lance Bennett & Philip.N.Howard Evolving Public Private Partnerships: A new model for E-Government and E-Citizens. 53.Rien Wagenvoort, Carlo de Nicola and Andreas Kappeler Infrastructure finance in Europe: Composition, Evolution and crisis impact(2010). 54.Georg Inderst Infrastructure as an asset class(2010). 55.Florian Bitsch, Axel Buchner & Christoph Kaserer Risk , Return and cash flow characteristics of infrastructure fund investments(2010) Websites:www.worldbank.org www.ppptoolkit.com www.pppdatabase.com