4.7 Both the center and some of the states have had in place for some time policies on private participation for specific sectors: in ports, for example the center issued "Guidelines on Privatization" for the major ports in 1996 and Gujarat preceded this with a ports policy in 1995.
4.8 New policy initiatives would however be useful in an effort to scale up and broaden the PPP program, both at the central and state level. Importantly, this would have the government concerned set out clearly why PPPs are being pursued and the benefits sought; and indicate that they will only be pursued where these benefits can realistically be expected. As noted in Section 3, one of the gaps in PPP frameworks in India compared to many other countries is the emphasis on PPPs as raising additional capital, rather than only being pursued where services will improve and taxpayers and consumers will get value-for-money. This could be addressed by a clear policy statement which would make clear both the rationale and also the limits to the use of PPPs. This would help to give the PPP program a clearer political mandate.
4.9 Broad policy initiatives would also enable governments to announce more clearly the institutional framework for PPPs. This could include the regulation, oversight and evaluation of PPPs, all areas which need strengthening, as well as the role of any new cross-sectoral units in developing and implementing PPPs. Another important area to be addressed would be procedures for the procurement of PPPs, in particular the use of competitive processes, and approaches to be adopted towards unsolicited projects.
4.10 While broad policies provide an important signal of political commitment, it may also be necessary to translate this into action plans and policies for individual sectors. These could provide a more precise orientation to encourage line ministries and agencies to pursue and implement PPP programs.