[UPPSC-UP Special Syllabus Decoded] Evolvement of PPP for Development of UP

1. Policy Evolution & Institutional Framework

Trend: Shift from “State-Funded” models to “Viability Gap Funding (VGF)” and “Asset Monetization.”

• Policy Shift: UP has transitioned from the PPP Guidelines 2016 to sector-specific incentive policies (e.g., UP Healthcare Policy, Heritage Tourism Policy).
• Institutional Support:
  • Invest UP: The nodal agency acting as the interface for private investors.
  • PPP Bid Evaluation Committee: Streamlines approvals for projects >₹100 Crore.
• Models Adopted:
  • DBFOT (Design-Build-Finance-Operate-Transfer): Used in Bus Terminals and Highways.
  • HAM (Hybrid Annuity Model): Preferred for Road projects (low risk for private players).

2. Sectoral Application of PPP in UP

Trend: Moving beyond roads to “Social Infrastructure” (Health & Education).

A. Transport Infrastructure (The Pioneer Sector)

• Roadways (Bus Terminals): Modernizing old bus stations into “Busports” with malls and hotels.
  • Status: First phase includes 23 bus terminals.
• Expressways: While main carriageways are EPC (State-funded), Wayside Amenities (Rest stops, EV charging) are developed via PPP.
• Logistics: Multi-Modal Logistics Parks (MMLPs) at Dadri and Kanpur being developed by private players under the state’s warehousing policy.

B. Health Infrastructure (One District One Medical College)

• Objective: To establish medical colleges in unserved districts (e.g., Maharajganj, Sambhal) where the government provides district hospitals and land, while private players bring capital/expertise.
• Model: VGF Model (Viability Gap Funding) where the Center and State share the subsidy cost.

C. Tourism & Heritage (Adaptive Reuse)

• Heritage Hotels: Converting historical forts and palaces (e.g., Chunar Fort, Barua Sagar) into heritage hotels.
  • Policy: “Adaptive Reuse Policy” allows private players to lease heritage sites for 30-90 years.

3. Issues & Challenges

• Revenue Risk: Private players fear low footfall in remote districts (e.g., Medical colleges in Chitrakoot/Shravasti).
• Land Acquisition: Delays in handing over encumbrance-free land often stall the “Appointed Date” for projects.
• User Charges: Political sensitivity towards increasing tolls or bus fares impacts project viability.

4. Current Affairs Linkages

• Bus Terminal Modernization (March 2025): The UPSRTC awarded a major PPP contract worth ₹2,700 Crore to modernize 6 key bus terminals (including Ayodhya Dham, Lucknow-Gomti Nagar, and Prayagraj Civil Lines) into airport-like hubs.
• Heritage PPP Projects (July 2025): The UP Cabinet approved the leasing of 11 Heritage Sites (including Talbehat Fort in Lalitpur and Chattar Manzil in Lucknow) to private hotel chains for conservation and tourism.
• Medical Colleges (March 2025): Foundation stones were laid for new PPP-mode medical colleges in Baghpat, Hathras, and Kasganj, utilizing the VGF scheme to bridge the funding gap.
• Jewar Connectivity (Sept 2025): The PPP Appraisal Committee (PPPAC) approved the Greenfield Link Expressway connecting Jewar Airport to the Delhi-Mumbai Expressway under the HAM model.