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PPP IN ANDHRA PRADESH

Submitted to:Mr. Naveen MEHTA

Submitted by:MONEY GARG SIMRAN GROVER

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About Andhra Pradesh

A.P. is one of the 28 states of India, situated on the country's southeastern coast. It is India's fourth largest state by area and fifth largest by population. Its capital and largest city is Hyderabad. ndhra Pradesh has the second-longest coastline of 972 km (604 mi) among the states of India.[7] Two major rivers, the Godavari and the Krishna, run across the state. The small enclave (30 square kilometres (12 sq mi)) of Yanam, a district of Pondicherry, lies in the Godavari delta in the northeast of the state. The state is organized into three united regions: Telangana, Coastal Andhra, and Rayalaseema. The state's most populous cities are Hyderabad, Visakhapatnam, Vijayawada, Guntur, and Warangal. Andhra Pradesh is the only state with abundant energy. It ranks second number in terms of number of industrial estates in the country. Second largest store house of minerals in the country. It is the fourth largest economy of the country.

Government of AP is the first state to bring in legislation of Infrastructure Authority Act.

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Advantages of Andhra Pradesh in terms of infrastructure

Exceptional experience in delivering PPP projects Commercial format of infra projects accepted locally

Presence of demand drivers and willingness to pay

Physical infrastructure in Andhra Pradesh

Road: National highways: 17 national highways in the state covering a length of 4,537 km State road and building (R&B) department roads: total R&B road network stood at 1,91,792 km in 2006-07. Road density per thousand sqkm was 697.43 as of 2006-07 Railways: South Central Railway covers a network of 4,752 km in the state Secunderabad is the headquarters of the South Central Railways The state has a total of 748 railway stationsthe rail network comprises of 3,754 km of broad gauge and 508 km of metre gauge tracks

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Mass Rapid Transit Service (MRTS): MRTS is expected to carry about 1.6 million passengers per day by 2011 and 2.6 million passengers per day by 2021. The total cost for the project has been calculated at US$ 2.6 billion. The state is home to the first PPP Metro Rail Project to have been sanctioned by Government of India. The Central government has already sanctioned 20 per cent of the project cost through the Viability Gap Funding (VGF) scheme. This project is expected to reduces pollutants by about 3,100 tonnes per annum Aviation: International airport at Hyderabad and domestic airports at Visakhapatnam, Tirupati, Rajahmundry, Warangal, Vijayawada, Donakonda, Kadapa and Puttaparthy The state capital, Hyderabad, is connected to all major international destinations such as Amsterdam, Bangkok, Chicago, Frankfurt, Dubai, Singapore, Sharjah, London, Kuala Lumpur, etc., besides all major domestic destinations across India The state has a new international airport at Hyderabadthe Rajiv Gandhi International Airportnear Shamshabad (about 27 km from Hyderabad). This airport has replaced the former international airport of the city at Begumpet. It has been built by the Hyderabad International Airport Limited (HIAL), a public-private joint venture between the GMR Group, Malaysia Airports Holdings Berhad, the state government of Andhra Pradesh and the Airports Authority of India (AAI). The total cost for this project is US$ 560 million and it is built on an area of 5,449 acres. Ports Andhra Pradesh is considered to be the second-highest cargo-handling state in India.

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The state has one major port at Visakhapatnam, two intermediate ports and 11 minor ports within the state Telecommunications 4,166 telephone exchanges and 5.6 million telephone connections (excluding mobile phones) were registered in the state as of March 2009. Number of public call offices as of March 2009 were 2,00,291 The state has approximately 44,000 km of fibre optic cable network across public and private sector connections. Reliance Communications has created infrastructure for providing the required bandwidth for basic telecom services and other high-end services by laying a fibre optic cable backbone of 3,000 km throughout the state Power Installed capacity as of April 2009 was 13,147.25 MW (provisional) 31,110.31 million units of energy available from various sources as of March 2009 As of April 2009, 31,751 housing colonies of the weaker section were electrified. As of April 2009, number of dalit-wadas electrified were 56,178. Per capita consumption was 703 Kwhin 2007-08. Around 26,85,559 agricultural consumers were registered as of April 2009.

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Existing scenario of ppp

Government of A P is the first state to bring in legislation of Infrastructure Authority Act This Act would primarily focus on facilitating private developers in securing much needed administrative approvals, arbitrations and fiscal regulations. Infrastructure would cover Highways including 1. Bridges 2. Ports 3. Power and Water 4. Communication Net Work 5. Gas Distribution 6. Waste Management 7. Urban Infrastructure would cover Housing, Urban 8. Development, Medicare and Leisure facilities etc.

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Airports Airports Education Energy/Power Health Roads Sea Ports Tourism Urban Infrastructure Others Total Upcoming Projects Grand Total

No.s 1 5 2 7 35 4 42 41 19 156 52 208

Amount (In Cr. Rs.) 2487 1026 816 1185 6076 12596 2015 21262 3954 51417 23947 75364

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Major Projects of PPP in state

FAB CITY Kakinada SEZ Outer Ring Road New IT Parks At Vizag Vijayawada Warangal And Tirupati Vizag, Sector Focused SEZs Gem And Jewellery IT Hardware & Electronic Petro Chemical Complex At Vizag Footware At Mambattu Near Tada

Non Major Sea Port OMST Operate Maintain Share and Transfer Kakinada Deep Water Port BOOT Build Own Operate and Transfer Gangavaram Port Machilipatnam Port ( under process)

Airport BOO Build Own Operate Hyderabad Intl Airport

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Andhra Pradesh infrastructure policy

The Andhra Pradesh Infrastructure Policy (The Policy) provides guidelines for attracting and facilitating private investments in infrastructure through: Empowering the Task Force set up to address issues relating to all infrastructure project. A speedy and transparent selection mechanism Adequate administrative support and reduction in procedural delays A bankable risk sharing mechanism. The Policy envisages the need for a special legislation called Infrastructure Development Act (IDA), which would be supported by a set of rules, guidelines and sectoral policies. An Act to provide for the rapid development of physical and social infrastructure in the State and attract private sector participation in the designing, financing, construction, operation and maintenance of infrastructure projects in the State and provide a comprehensive legislation for, reducing administrative and procedural delays, identifying generic project risks, detailing various incentives, detailing the project delivery process, procedures for reconciliation of disputes and also to provide for other ancillary and incidental matters thereto with a view to presenting bankable projects to the private sector and improving level of infrastructure in the State of Andhra Pradesh and for matters connected therein or incidental thereto. Infrastructure project fund ESTABLISHMENT OF THE FUND: The Government shall establish a Fund to be called the Infrastructure Projects Fund and shall contribute a sum of Rs.100 lakhs to the Fund. The Government will make such further contributions to the Fund as it may deem appropriate from time to time. FEES AND CHARGES TO BE CREDITED TO THE FUND: The Government Agency or the Local Authority will interalia levy fees and charges on the application for Projects and Project fee on the Developer under the Concession Agreement as may be Prescribed from time to time and which fees shall be credited to the Fund.

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ADMINISTRATION OF THE FUND: The Fund will be administered and managed by the Infrastructure Authority and the Infrastructure Authority will be entitled to appoint an officer or officers for the management, control and administration of the Fund. UTILISATION OF THE FUND: The Infrastructure Authority will utilise the Fund for achieving objects and purposes of this Act and for financing the activities of the Infrastructure Authority for realising the objects and purposes of the Act, time to time. OPERATION OF THE FUND: The Fund will be operated by and under the name of the Infrastructure Authority. FORMULATION OF POLICY & REGULATIONS FOR THE FUND: The Infrastructure Authority shall formulate its policy and regulations for financing, working, administration and management of the Fund. AUDIT REPORT OF THE FUND: The working of the Fund shall be subject to audit by Comptroller and Auditor General and the Infrastructure Authority shall submit a report every year as regards the working and operation of the Fund, to the State Government who will present the same before the Legislative Assembly of the State. The IDA would constitute a special Infrastructure Promotion Authority (IPA) having quasi-judicial functions, while the Task Force would undertake the executive functions outlined in the IDA. A high-level Task Force chaired by the Chief Secretary is constituted. The executive functions of the Task Force would be as follows: 1. Conceptualize new projects 2. Identify inter-sectoral linkages 3. Provide enablers for privatisation 4. Decide form and extent of Government support 5. Resolve process-related issues

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6. De-bottleneck the project development process 7. Decide issues pertaining to user levies 8. Prepare model contracts 9. Prescribe timelines for clearances and denial conditions 10.Issue rules and guidelines 11.Build public opinion

The Government will offer the following support under 3 categories to all the projects covered under this policy, viz. i) Administrative Support, wherein 1. State-level statutory clearances will be enumerated and provided within prescribed time limits. 2. Non-Statutory State level clearances will be Automatically granted if project meets required specifications. 3. Government will proved Best-effort support for all central level clearances 4. Department will undertake all Rehabilitation & Resettlement (R&B) activities and recover the cost from Developer. Asset Based Support, wherein: 1. Government owned land may be provided at concessional cost for projects in which ownership would revert to the Government 2. If Government land is not available and where it is not possible for private investors to obtain land for the project on their own, Andhra Pradesh Industrial Infrastructure Corporation Ltd. would acquire the land required for the project,charging concessional administrative expenses. 3. Government will facilitate development of linkage infrastructure for projects Foregoing of Revenue Streams, wherein the Government will : 1. Exempt all inputs required during the construction period from Sales Tax.

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2. Exempt the first Sale / Transfer from payment of Stamp duty and Registration Charges. 3. Exempt payment of Seigniorage Fees and Cess on minor minerals during construction of the project.

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New industrial policy 1. Infrastructure facilities such as Roads, Electricity, Water etc., "will be provided at the door step" of the proposed industry in the areas identified by the State Government as Industrial Areas. 2. Government also facilitates creation of allied infrastructure such as Telecommunication facilities including Internet connectivity and information Kiosks, Transportation links from Industrial Areas to Towns (bus service), Housing Complexes nearer to industries, Container Depots, Exhibition Halls by promoting private participation. 3. An Industrial Infrastructure Development Fund (IIDF) of Rs.100 crores may be created starting with the year 2000-2001 with provision for necessary step up in fund provision in the subsequent years. This money may be used only when there is no provision for taking up the Infrastructure works under the regular budget/programmes of the concerned line department. 4. 10% of the IIDF may be spent on Technology Development Cluster Development and Market support systems for the SSI and Tiny sector such as providing corpus for establishment of Technical Institutions, Incubation Centers etc. 2. Wherever industries are located in places other than Industrial Areas(isolated areas), the Government will share the cost of infrastructure up to 25% Tourism policy The present Tourism Policy outlines the framework for the enabling role of the Government and the involvement of the private sector in development of various tourism products in the State of Andhra Pradesh. The present policy has been developed by analyzing all the deficiencies so as to provide practical and modern solutions, and also by keeping in mind the best practices that have been adopted by other states in the country successfully. With the new tourism policy, the state of Andhra Pradesh should expect to benefit in the following ways: 1. Position the state competitively for attracting private sector investments in Tourism and Hospitality sectors

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2. To promote inbound tourism in all potential destinations of the state, and not just to few destinations like Tirupati, Hyderabad, Visakhapatnam, Puttaparthi, etc. 3. To target the incentives to the private sector better as per the State government's priorities in terms of geographical areas and tourism products 4. To maximize the potential of Hyderabad city to promote new tourism products 5. To give adequate focus to Aam Aadmi Tourism, Rural Tourism, Eco-tourism, Adventure tourism and Safe and Responsible tourism 6. To focus on maximum generation of employment in the sector. INCENTIVES and CONCESSIONS Concessional allotment of land Capital investment subsidy Reimbursement of stamp duty and transfer fee Reimbursement of vat Reimbursement of luxury tax Reimbursement of entertainment tax Energy incentives

INSTITUTIONAL ARRANGEMENT The following institutional arrangements are put in place to secure accelerated development of tourism in state and to address all inter departmental issues while monitoring and securing the development of tourism in the state: 1. State Tourism Promotion Board. 2. State Tourism Promotion Committee. 3. District Tourism Promotion Committee.

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Solar power policy

The Non-conventional Energy Sources Development Corporation of Andhra Pradesh (NEDCAP) plans to provide total solar power to newly constructed villages under the Rehabilitation and Reconstruction Scheme of the Andhra Pradesh government, In Andhra Pradesh, street lighting in 47 villages have been equipped with solar power and in 17 other villages, every house has been provided with solar-powered LED bulbs to save energy. Government of India provides 30 percent subsidy on purchases of solar water heaters and photovoltaic electrical equipment. Government of India provides concessions to industries which save energy and those heavy industries like cement, fertiliser, textiles can avail subsidy and concessions provided by the government.

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Conclusion
To conclude ,AP has great scope for infrastructure GOMP is making efforts for attracting private participation .Government of Andhra Pradesh have decided to undertake Mega infrastructure projects in state to attract industries and for overall development of state. Interlinkages of infrastructure sectors is required for proper development of infrastructure in state contributing to its growth and development

Bibliography
http://www.pppinindia.com/pdf/ap_presentation.pdf http://www.aptourism.in/investments-site/TOURISM_POLICY_2010.pdf http://industriesportal.apcgg.gov.in/BusinessGuide/Documents/infrastructurepolicy.pdf http://infrastructure.gov.in/pdf/IIFCL.pdf

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