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Large PPPs like BIAL - ripe for corruption?

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Written By admin123 - 25 July, 2008

BIAL Bangalore PPP Corruption RTI Transparency

[A Request - This is a carryover from talk of corruption and transparency that emerged in this HAL-BIAL thread. Please don't drag the peripherals like big people wanting airport in their backyard etc into this. Add your wisdom and tips that are relevant here.]

We really want to understand this. What are the transparency and disclosure norms for PPP (Public Private Partnership) Projects? Looks like they don't come under the purview of RTI Act, at least the matter is not settled yet (We believe BIAL has filed an appeal against a court verdict that put it under RTI). Does lack of transparency set PPP projects up for corruption?
Simply put, PPP is "project based on contract or concession agreement between a Government or statutory entity on one side and a private sector company on another". There are several ways in which government and private sector can get involved. Leave aside the private sector (they bring in Management or asset maintenance skills, operational expertise, or just offer goods or services), lets look at the ways in which governments brings things to a PPP to make it attractive to Private parties. These would be:

  • Provide investment capital by using tax money
    • Ex: GoK investing in BIAL?
  • Offer long term contract to consume services of the PPP, thus making it more attractive for investment
    • Ex: I promise to buy all your power at rate X. Or, for BIAL: I promise no airports in 150 km radius.
  • Investments not in cash but kind - offer goverment land, or stale assets (land at concessional rates to NICE for BMIC, land for BIAL as well)

Now, when we talk about small sized PPP initiatives, say 10 crores to build a road, arguably, it is easier to watch and say if the money has been spent and used well. How do we do that for a large project like BIAL?

  • Government provided land at subsidized rates to BIAL (this would be investment in kind, not cash)
  • Government has further invested some cash in the venture. ??? crores (GoK and AAI combined). This is our money, comes from the taxes we pay.
  • BIAL is a Rs 2500 crore project. this amount doesn't include the 'value' of land the the state government brought in.

Forget the land dealings, thats a messy thing to get deep in. Let us talk about the accounting aspects of BIAL.

  • How do we know that the airport is worth Rs 2500 crores? For lack of access to a detailed account or report in public domain, if one looks at Hyderabad Airport (another PPP) for comparison, it certainly seems bigger and more lavish with lot more visible concrete construction
  • BIAL must be submitting detailed accounts and financial reports about its investment. why are those not in public domain?
  • Who is the auditor for this super sized PPP project? If there is none, can we, the public, get Lokayukta involved?

The worry we have is this, and fairly simple to explain. How do we know that the following has not happened:

  • BIAL says they spent 2500 crore to build the airport
  • But they may have spent only Rs 2000 crores
  • The unaccounted money may be with BIAL themselves, waiting to be spent, or, may get 'shared' between whoever is supposed to watch over the accounts of this PPP.
Please note, we are not saying - is BIAL a scam? We have no proof or credibility to make such tall statements. But how do we know? What we are asking for is - since its a PPP, who should carry the burden of transparency? Public, government, or the private enterprise itself?

Understand that its important for us to know and tune the workings of large scale PPPs really well. PPP is being touted as the cure-all model for our infrastructure woes, and we don't want this excellent idea to fail due to lack of transparency and accountability.

COMMENTS

Not the full list !

kbsyed61 - 25 July, 2008 - 15:45

SB,

It looks like all the pages has not been posted here. Actually the 8th page in AAI_Reply_02_BIAL document contains some answers that clearly indicts AAI rather than private partners.

Could you pls post these documents in its enterity?

P. S. I have emailed you these docs. 

Syed 

Channelise the Clout in right direction.........

kbsyed61 - 25 July, 2008 - 04:49

BT,

Before we jump the gun, I would suggest that Praja should have a definite and well defined plan of action to take on BIAL issue specially against AAI & MoCA. I am not sure just collecting the info would change anything. Unless it is followed up with some action resulting in intervention by the government authorities or court to fix up the bunglings due to corruption and political/business nexus.

Answers to the following question should help in formulating the objectives in BIAL-Action Plan:

  1. What is that we expect from BIAL as a airport project for B'lore?
  2. What is that BIAL failed to meet our expectations?
  3. If BIAL has failed the decent airport dream of Bangalore, who is responsible for this failure?
  4. What can be done to mitigate the BIAL failures if any?
  5. What could be the Praja's response to this crisis?
  6. How does we can help Praja realise this response?

SB and others, can we form a Airport Work Group to take up this issue and see that Bangalore's dream for a decent airport is not shaterred.

Syed

anonymous coward

tsubba - 25 July, 2008 - 15:53

"we can of course think of better sounding names to use on praja." like tarlesubba or silkboard or even bialterminal perhaps? :) but their is a caveat. how do you sift between genuine off the record stuff and sky is falling type of rumours? important to blow whistle but need to be careful.

Re: Want anonymity? And replies to Syed's RTI.

bialterminal - 25 July, 2008 - 15:25

Admin,

Smile Not sure what "anonymous_coward"  is intended to be meant...I would suggest....  "respecting each other's privacy" would be more appropriate :-) 

Anonymous Coward

shas3n - 25 July, 2008 - 15:37

bialterminal, although the term 'anonymous coward' might seem a bit derogatory, it is a common internet ‘lingo’ word to indicate people who wish to remain anonymous. The derogatory overtones of the term are not present anymore, but we can of course think of better sounding names to use on praja. Here is more information on the origins and meaning of the term. http://en.wikipedia.org/wiki/Anonymous_Coward -Shastri

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