PUBLIC PRIVATE PARTNERSHIP PPP
A public–private partnership PPP is a government tune-up or private business project that isfinanced and operate through a partnership of government and private sector companies.
PPP involves a agreement between a public sector authority and a private company, in which the private company provides a public service or project and assumes monetary, scientific and operational risk in the project. In some kinds of PPP, the cost of using the service is bear exclusively by the user of the service and not by the taxpayer. In other types capital investment is made by the private sector on the basis of a agreement with government to provide fixed services and the price of providing the service is borne by the government
Government contributions to a PPP may also be in projects that are aimed at creating public possessions
like in the road and rail network sector, the government may provide a funds financial
support in the form of a one-time funding, so as to make the project efficiently
practicable. In some other cases, the government may support the project by
providing income subsidies, including duty breaks or by assured annual revenues
for a fixed time period. In all cases, the partnerships include a transfer of risks
to the private sector.
There are usually two basic drivers for PPPs. First, PPPs are claim to enable the public sector to tie together the skill and efficiencies that the private sector can bring to the delivery of positive amenities and services usually procured and delivered by the public sector.
The PPP borrowing is incur by the private sector
medium implementing the project. On PPP projects where the price of using the
service is planned to be borne exclusively by the end consumer, the PPP is the
public sector's perspective an
"off-balance sheet" method of financing the delivery of new or refurbish
public sector belongings. On PPP projects where the public sector intends to pay
off the private sector through availability payments once the facility is
established or transformed, the financing is, from the public sector's viewpoint,
"on-balance sheet"; however, the public sector will regularly benefit
from significantly delayed cash flows.
