Chapter IV PROCEDURE FOR PERFORMANCE OF FUNCTIONS OF THE BOARD

1. (1) For the identification of projects for private sector participation in infrastructure development in pursuance of section 14, the Board may consider suggestions from Government agencies or persons engaged in the business of developing or implementing infrastructure projects.
2. (2) The Board may itself conduct or have conducted on its behalf such preliminary investigations as are necessary to establish the prima facie suitability of the project for private sector participation within the parameters for a concession agreement or arrangement given in section 16 in identifying the projects which can be developed for private sector participation.
3. (3) The Government agencies may opt to undertake the development of such identified projects on their own or with the assistance of the Board.

The following parameters for a concession agreement or arrangement shall define the suitability of a project for inviting private sector participation, namely:-

1. (a) the concession agreement or arrangement may provide for the transfer of a project taken up with private sector participation, to the Government or its agencies not later than a period of 99 years from the date of agreement or arrangement of implementation of a project ;
2. (b) the concession agreement or arrangement may provide for financial participation by the Government or its agencies in any project up to a maximum of 20% of the project cost and the actual nature and quantum of this financial participation shall be based on the processes of due diligence and competitive bidding provided in the regulations framed by the Board for this purpose;
3. (c) the concession agreement or arrangement may provide for such incentives to the project as are admissible under the concerned sectoral policy of the Government to promote private sector participation or investment ;
4. (d) the concession agreement or arrangement may provide for guarantees by the State Government or Government agencies in respect of liability of any Government agency with regard to a project;
5. (e) the concession agreement or arrangement may provide for the opening and operation of an escrow account with respect to any payments to be made to the project by the State Government or any Government agency or any other person or persons;
6. (f) the concession agreement or arrangement may provide for appropriate modes and terms for transfer of Government land and acquisition of private land for the purposes of project implementation ;
7. (g) the concession agreement or arrangement may provide for right to develop land for such purposes as are admissible under the relevant statute; and
8. (h) the concession agreement or arrangement may provide for the levy of the charges for the facilities or services provided by the project.

1. (1) In deciding the manner in which an identified project is to be developed for private sector participation from amongst the options available under section 14, the Board shall have regard to its own capabilities, offers available for collaboration by other agencies and any agreement or arrangement entered into by the Government for this purpose with any person and form such special purpose vehicles, companies or entities on its own or as joint ventures as may be prescribed by regulations.
2. (2) In considering a proposal for project development by private sector participation under section 14, the Board shall ensure that any exclusive right for project development conferred on such persons is limited to a specified period.

1. (1) The Board shall ensure that any concession agreement or arrangement formulated by the Board under section 14 is in consonance with the parameters given in section 16 and contains all necessary covenants to take care of the risks associated with the concerned project.
2. (2) The concession agreement or arrangement shall strive for the optimum contractual structure with regard to the need to balance the risks of stakeholders, maximize efficiency and minimize costs as may be prescribed by regulations.

In order to ensure implementation of a project developed under this Act, the Board may form such special purpose vehicles, companies or entities on its own or as joint ventures as are deemed necessary for this purpose, keeping in view the need to comply with the conditions outlined in section 16 with regard to the involvement of Government or its agencies.

1. (1) In inviting private sector participation and making recommendations to the Government under section 14, the Board shall follow a selection process, which adheres to accepted norms of transparency and cost effectiveness and the Board shall frame the regulations to lay down the situations where competitive bidding method or other methods shall be followed.
2. (2) In making a recommendation with regard to a private sector participant with respect to a project developed under section 14, the Board may recommend grant of first right of refusal to the person developing the project, however, such first right of refusal shall be granted only on the basis of an appropriate procedure, which adheres to accepted norms of transparency and cost effectiveness.

1. (1) The Board may charge such fee, for carrying out any of its functions, as prescribed by regulations or in terms of any agreement or arrangement entered into by it.
2. (2) The Board may also permit any person developing a project under section 14 to receive a similar amount as fee, if the project developed by such a person is undertaken by any other person.

1. (1) For raising of resources for financing development expenditure under the State Plan in pursuance of section 14, the Board shall make procedure consistent with the need to ensure transparency and cost effectiveness.
2. (2) The Board may take the assistance of recognised financial institutions and reputed arrangers in performing this function.