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Rethinking PPP in India - Catalyzing Economy Through Infra Push

New Delhi, November 21:Taking forward the Government's vision of ‘Make in India’, Mr. Rana Kapoor, MD & CEO, YES BANK said, "Make in India with design and innovation will translate to Create in India. The current atmospherics are fantastic and very positive and the Government's moves have started transforming the economic landscape to attract more big ticket investments.”

Mr. Kapoor further pointed out, "What we have seen from the Government so far are however, 'baby steps' in the right direction. If I were to give an analogy, I would say we are moving from first gear to second gear given the immense opportunity that lies ahead of us as a nation. India will require consistent infra push and development all the way up to 2050. India is a 9-10% economic growth story, and this can be actualized with the current Government’s vision and action oriented approach, as seen since coming to power."

Even so, there are key constraints to the PPP model, especially as far as the quality of bank funding is concerned, which is a major determinant of the eventual success of infrastructure development. Mr. Kapoor pointed out that, "PSU banks, given their pre eminence in the economy with over 70% market share, need to be a lot more efficient and creative. We also require a lot more streamlined credit risk management and sectoral focus in the PSU banks, given that they have extraordinary leadership and expertise". He also feels, “that there is a definite need to have more project finance institutions in the country, as the three largest project finance companies have now turned into retail banks.

"One of the biggest issues is that a number of banks and institutions are over-leveraged in certain sectors," said Mr. Kapoor.

On the issue of ensuring the success of PPPs Mr. Kapoor made six key recommendations:

  1. Improve sector and region specific regulations

  2. Introduction of a mechanism to avoid over and unrealistic bidding by corporates and enable contract renegotiation

  3. Amendment of land acquisition norms on the lines of UK's Planning Act of 2008

  4. Evolution of a social equity model of development by engaging all stakeholders

  5. Better planning and technical expertise for PPP projects

  6. Replication of key global best practices in the Indian ecosystem

With the recent fillip that 'Brand India' has got on the global stage, the Government may consider building an agency with private participation to drive 'Brand India', on the lines of the highly successful Brand USA initiative. This, in his view, will ensure exponential growth of the Indian tourism industry as well as associated sectors which have vast untapped potential.

About YES BANK

YES BANK, India’s fifth largest private sector Bank with a pan India presence across all 29 states and 7 Union Territories of India, headquartered in the Lower Parel Innovation District (LPID) of Mumbai, is the outcome of the professional & entrepreneurial commitment of its Founder Rana Kapoor and its top management team, to establish a high quality, customer centric, service driven, private Indian Bank catering to the future businesses of India. YES BANK has adopted international best practices, the highest standards of service quality and operational excellence, and offers comprehensive banking and financial solutions to all its valued customers.

YES BANK has a knowledge driven approach to banking, and offers a superior customer experience for its retail, corporate and emerging corporate banking clients. YES BANK is steadily evolving as the Professionals’ Bank of India with the long term mission of “Building the Best Quality Bank of the World in India” by 2020.

For further information, please contact:

YES BANK
Krunal Mehta
Ph.: +91 22 66699153
Email: krunal.mehta@yesbank.in

Adfactors
Jyothi Goswami
Ph.: +91 22 67574444
Email: jyothi@adfactorspr.com

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