Projects need funds for developing capital assets, undertaking operations, and for the maintenance of the project. The funding options are determined by the project size. Projects that are financially viable on a standalone basis are expected to be funded by the private partner. However, projects that are not viable on a standalone basis require funding support to make them viable for development by a private partner. More on funding mechanisms and the sources of finance is discussed in Module 6.
There are several GoI and State Government sponsored schemes that provide grant support for development of infrastructure projects under PPP framework. In projects that require financial support/grant from the Government to become viable, the funding arrangements must be in place by the public entity prior to bidding for the project.