Public-private partnerships take root in Sindh, Punjab

The success of initial public-private partnership (PPP) projects in Sindh and Punjab served to remove apprehensions regarding the concept in Pakistan. They paved way for expanding the scope and the coverage of such collaborations in the country to deliver sustainable development efficiently.

The benefits of projects (such as Thar coal mining and power project, HyderabadMirpurkhas dual carriageway, and the southern loop of Ring Road and a railway crossing flyover in Lahore, etc) demonstratively accrued beyond the direct users of these facilities. They helped sideline the venom-spitting elements on both sides of the public-private divide and strengthened the futuristic current. The clarity on striking the right balance between risk and reward sharing, it appeared, was yet to be achieved in the relevant circles.

"PPPs are all about striking equilibrium between public and private, risk and reward, cost and benefit, particularly in resourcescarce countries with big chunks of population excluded from the economic mainstream," commented an expert.

A PPP is an arrangement between the government and a private business for the provision of public assets or services through investment and/or management by the private sector for a specified period of time. It entails clearly defined allocation of risk between partners and payments to the private sector linked to pre-determined benchmarked measureable performance standards. Background research found all provincial governments in Pakistan were looking forward to partnering with the private sector under the PPP mode to effectively respond to development needs.

"The red tape has not morphed into red carpet for the private sector, but the bureaucratic mindset to monopolise public service delivery is changing. On the other side, the reluctant private sector has also been discovering the value of government collaboration in megaprojects for both profit and prestige," commented a senior team member of the public-private partnership cell in Sindh.

The well-equipped cell has been func- tional in the finance department for a decade now, though the Sindh PPP Act was enacted in 2010. Punjab created its PPP unit in the planning and development department, which supervises the policy and the projects with PPP modes in 18 line ministries, under the Punjab PPP Act of 2014. Following the lead, the Khyber Pakhtunkhwa PPP Act was enacted in 2014 and the unit was established, but it was facing capacity challenges.

In Balochistan, work in this regard was still in progress. Essa Tahir, an official involved in the exercise in the province, told media from Quetta that the planning department would table the proposed PPP bill in the next provincial cabinet meeting.

"The complex nature of the PPP arrange- ments necessitated specialised skill set (financial, technical and legal) to handle and implement public interest projects in physical and social infrastructure. Development partners like the Asian Development Bank and the World Bank have agreed to assist us in this regard for the next two years", Azhar Khan, KP's PPP coordinator, told media over the phone from Peshawar.

Agha Waqar Javed, head of Punjab's PPP cell, said projects have already been awarded in housing, infrastructure, transport, health, food and forestry sectors. "We are now structuring more sustainable and bankable transactions in livestock, tourism and recreational sector as well," he said in an emailed response.