Lessons in Private-Public Partnership (PPP) from India
India’s story of success in implementing the Private-Public Partnership (PPP) model makes it an important partner in facilitating the adoption of this model in Africa. India is one of the developing countries to have successfully received a large-scale investment to the tune of US $300 billion in infrastructure under the PPP model. In line with this, the Government of India has signed an Memorandum of Understanding with the African Development Bank Group to share the model agreements and legal documents associated with PPPs to facilitate implementation of this model in African countries.
Speaking at the "Africa-India Partnership Day", organized by the Export Import Bank of India (EXIM Bank of India) and the Federation of Indian Chambers of Commerce and Industry (FICCI) as part of the AfDB 2014 Annual Meeting, on Thursday, May 22 in Kigali, Nilaya Mitash, Temporary Governor of India, highlighted the shared history of India and Africa. He added that this makes India well placed to provide technical assistance to the continent.
According to former FICCI President R.V. Kanoria, the Government of India has been proactive in its commitment to encourage investment in Africa. “Indian investments in Africa have increased 14-fold in the past year and we are hoping that by next year it will rise to US $100 billion,” he said.
In addition to investment, is capacity building and knowledge sharing, particularly in the area of PPP. “The public sector in India has partnered with the private sector to bridge the infrastructure gap resulting in 50% private investment. We are also tapping the managerial capacities of the private sector to improve public services. This is what we would like to share with our African counter parts,” said India’s Temporary Governor, Mitash.
With more than a 1,000 PPP projects, India is said to have perfected the PPP model, which could arguably provide a solution to Africa’s infrastructural deficit. AfDB’s First Vice-President and Chief Operating Officer Emmanuel Mbi expressed Africa’s desire to learn from India and the AfDB’s will to support such efforts. He also emphasized the important role of the private sector in the development process.
According to Heikki Tuunanen, Executive Director at the AfDB, private enterprise should be encouraged particularly SMEs, which make up a large percentage of businesses on the continent and have the ability to absorb the existent work force. He added that India, a champion in SMEs could share some its experiences in this area and allow Africa’s 5 million SMEs to grow.