Date of effectiveness: 2013
The India Infrastructure Project Development Fund (IIPDF) provides financial support for quality project development activities. The Sponsoring Authority will, thus, be able to source funding to cover a portion of the PPP transaction costs, thereby reducing the impact of costs related to procurement on their budgets.
The salient features of the Scheme are:
- IIPDF will be available to the Sponsoring Authorities for PPP projects for the purpose of meeting the project development costs including expenses incurred by the Sponsoring Authority in respect of feasibility studies, environment impact studies, financial structuring, legal reviews and development of project documentation including concession agreement, commercial assessment studies grading of projects.
- IIPDF would finance an appropriate portion of the cost of consultants and transactions advisors on a PPP project where such consultants and transaction advisors are appointed by the Sponsoring Authority either from amongst the transaction advisers empanelled by Department of Economic Affairs or through a transparent system of procurement under a contract for services.
- IIPDF will not finance the expenses incurred by the Sponsoring Authority on its own staff.
- Sponsoring Authority will create and empower a PPP Cell to undertake PPP project development activities and larger policy and regulatory issues to enlarge the number of PPP projects in Sponsoring Authorities’ shelf.
- IIPDF will be a grant and will ordinarily fund upto 75% of the project development expenses. On successful completion of the bidding process, the project development expenditure would be recovered from the successful bidder.
- In case of failure of bid, the assistance would be recovered and Sponsoring Authority would be liable to refund the amount of assistance received. Balance 25% will be co-funded by Sponsoring Authority. Assistance from IIPDF would be released after the share of the Sponsoring Authority has been released.
- The IIPDF would be on budgetary outlay of Ministry of Finance, Government of India. This would be supplemented through budgetary support by the Ministry of finance.
- The IIPDF would be administered by Empowered Institution under Ministry of Finance with Additional Secretary as Chairperson and Members from Department of Expenditure, Planning Commission, Joint Secretary dealing with the subject in line Ministry and Joint Secretary, DEA.
- Empowered Institution will select projects for which project development costs will be funded, set the terms and conditions under which the fund would be provided and recovered and set milestones for disbursing and recovering the fund.
With the facilitative environment being created by Finance Minister as well as the availability of funds through various Government schemes, PPPs in India are creating a robust enabling framework to catalyse infrastructure development in the country.