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Govt to provide sovereign backing, credit worthiness to local governments.

ISLAMABAD, 27 May, 2009 (Balochistan Times) -- The government wants to provide sovereign backing and credit worthiness to the local governments in order to attract foreign investors to form partnerships with them. This was said by Ghulam Murtaza Satti, Advisor to Infrastructure Project Development Facility (IPDF), while talking to a group of media persons here on Wednesday. He said that government was increasingly looking to the private sector for investments and development of capital heavy infrastructure projects. Pakistans initiative with Public Private Partnership (PPP) began with the establishment of the IPDF by the Government of Pakistan to facilitate PPP projects by providing expertise and hands-on support to public sector implementing agencies, he said. Giving details of projects, Satti said that currently, IPDF was handling a total of 13 different projects, in various stages of completion, having a cumulative worth of Rs. 230 billion. Of these, he added, the projects nearing finalization include the Karachi Circular Railway with approximate worth of Rs. 80 billion, CNG busses worth Rs. 0.4 billion, Cool Chain System along the National Trade Corridor approximate worth Rs. 12.0 billion, an IT Park under the PSEB amounting to Rs. 12.0 billion as well. Satti told that last week, high-level meetings took place between the Infrastructure Project Development Facility (IPDF), World Bank, its UK based consultants; the Cambridge Economic Policy Associates (CEPA), and important officials of the Ministry of Finance in order to set up two funds; Viability Gap Fund (VGF) and the Project Development Fund (PDF). The purpose of these funds is to compliment the Public Private Partnership (PPP) initiative in the infrastructure sector. Giving details of these funds, Satti said that The Viability Gap Fund (VGF) will function to help with projects which provide considerable social and economic benefit to society, but are not be commercially viable from the investors perspective. While The Project Development Fund is to be a revolving fund which can be accessed by various line ministries and the IPDF to assess the feasibility and to structure infrastructure projects comprehensively. Satti added that despite the obstacles and rapid political changes in the country, the IPDF has performed well relative to its counter-parts in other developing economies in its short life-span. The IPDF has undergone considerable organizational changes, but now seems to have achieved an organizational equilibrium with strong projects team having extensive experience in investment banking, project finance, transaction advisory and a legal team well-versed in PPP law, corporate law and contract and concessions law, he concluded.

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Publication:Balochistan Times (Baluchistan Province, Pakistan)
Date:May 27, 2009
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