If public and private mobilise resources together, any plans or projects could be achieved, especially in developing countries constraint with resources, according to the finance minister Namgay Dorji.
Launching the public private partnership (PPP) rules and regulations 2017, which was drafted in line with the PPP policy 2016 at the Tashichhodzong yesterday, he said that PPP is an alternative model, which is gaining momentum.
PPP policy 2016 states that PPP is a contract between an institution and a private party where the private party renovates, constructs, operates, maintains or manages an asset to provide a service in whole or in part, in accordance with specified output specifications. “The private party assumes the associated risks for a significant period of time and in return, receives benefits and financial remuneration according to agreed terms.”
The PPP rules and regulations would be applied to all upcoming PPP projects.
According to a press release issued by the finance ministry, the policy was approved as the government recognised the importance of investment in infrastructure, to accelerate socioeconomic development.
It also stated that it was viewed that the promotion of PPP was a key strategy for achieving sustainable economic investments and their operational efficiencies.
The policy, and the rules and regulations would help in meeting the growing demand for infrastructure development through shared risk and resources between the public and private sectors.
The policy covers all infrastructure and services where the private sector is able to provide public infrastructure and services that result in cost effectiveness and efficient delivery of the contracted obligation for the public good.
Lyonpo Namgay Dorji said the policy and the rules and regulations would help facilitate the resource constraints Bhutan is facing. “With this policy in place, I expect many PPP will come to Bhutan and play a very important role in the socioeconomic development of the country.”
Senior programme officer of PPP unit, Rinzin Pemo, said the policy, and rules and regulations would establish a uniform procedure to ensure transparency across various sectors. “It clearly mentions the procedures and process to be followed regarding PPP projects.”
The press release states that the policy supports the development of feasible PPP projects that would offer reasonable returns to the private sector, better service delivery options for the citizens while also protecting the government from fiscal risks. “The rules and regulations establish an environment for private investors to participate in PPP projects with the transparent and streamlined process.”
The rules and regulations also include clauses such as project identification and selection, needs analysis, feasibility analysis, and contract management.
For effective facilitation and implementation of PPP programs, a PPP unit was also established under the Department of Microeconomic Affairs last year.