Montek calls for PPP law to tap finances

Bhopal: Former deputy chairperson of the erstwhile Planning Commission Montek Singh Ahluwalia on Tuesday suggested rewriting of the Fiscal Responsibility and Budget Management Act and advocated for a public-private partnership law to tap finances.

In the changing scenario in view of rising finance needs and fiscal limitation of states, rewriting the Fiscal Responsibility and Budget Management Act should be considered, Ahluwalia, the author of Backstage: The Story Behind India's High Growth Years, added.

He was addressing a workshop organised by the finance department of Madhya Pradesh on 'Alternative Finance for Projects' at the Minto Hall here.

There is a need for enacting a law for public-private partnership to overcome the budget constraints for socially important economic infrastructure projects, he added.

Ahluwalia said designing projects, making budget provisions for them and completing them within available resources is a common practice across the world.

The fact is that governments have limited financial resources for ambitious projects. They have many tasks, responsibilities, priorities and social obligations apart from economic infrastructure projects, he added.

And as a result, the speed of projects slows down and starts lagging, he added. He said that there is a need to think beyond the conventional approach of relying on budgetary resources.

In such a situation, states look towards the private sector for assistance.