Urban Infrastructure Financing in India – What has changed? https://www.cenfa.org/urban-infrastructure-financing-in-india-what-has-changed/
The urban areas have seen a few national missions being implemented to improve the state of infrastructure as well as bring in conditionalities with funds for reforms to privatise delivery of services and implementation of projects by the ULBs. Private sector participation through PPPs and private investments in urban projects have been advocated in urban projects for the past several years including by institutions like the World Bank.
.. Risk allocation between public and private agencies has been a contentious issue in PPP projects since private sector wishes the public sector to take on majority of risks like investments, tariffs, social and environmental impacts, guarantees, etc leaving it free to earn risk free profits.
...The argument about the potential to increase user charges and other taxes to improve the economic base and creditworthiness of the city corporations and hence raise the private financing for infrastructure projects. However, this crucially misses the very important point about the prevailing economic conditions of the larger sections of the population, especially in the post covid years.
... implementation of private projects and reforms in the Indian context in urban areas have not been a success over a period of the past couple of decades. The previous missions like Jawaharlal Nehru National Urban Renewal Mission (JNNURM), Urban Infrastructure Development Scheme for Small and Medium Towns (UIDSSMT), Smart Cities Mission and Atal Mission for Rejuvenation and Urban Transformation (AMRUT) have attempted to implement these measures without much success. These missions had mandates to implement privatised PPP projects with reforms in hundreds of large and medium cities included in these missions. The lack of success of these missions shows that there needs to be a change in the national policies to implement urban projects and their financing, however it seems that the lessons from the past experiences have not been learnt.