DBFO – Innovation in PPP framework

Going by the concept, the DBFO model of PPP seeks to allow substantial freedom to the private sector in designing, financing and constructing a project under a long-term lease, operating on it during the term of the lease. The private partner transfers the project to the public sector at the end of the lease term. The standards set here are the output-based standards. The shift towards this output-based standard amplifies the private sector innovation and its adeptness in handling the project.

Currently, most of the infrastructure projects are being undertaken on Build Operate Transfer (BOT) model – either on toll or annuity basis. However, having envisaged the benefits of Design-Build-Finance-Operate (DBFO – most commonly and successfully applied PPP model in the UK and Australia), the Government and private players are now actively looking at developing and competing projects in time based on this model. This model ensures strong private participation in executing infrastructure projects with considerable public sector backing.

The government has announced development of 1,000 kms of access- controlled Expressways, through the DBFO Model. The sections that have been identified so far are Vadodara-Mumbai, Delhi – Chandigarh, Delhi-Jaipur, Delhi-Meerut, Delhi-Agra, Bangalore-Chennai and Kolkata-Dhanbad.

Major DBFO model based projects undertaken in India

o Golden Quadrilateral
o North South East West Corridor

Under DBFO, the detailed design work is in the ambit of the concessionaire (private player), which guarantees efficiency. We can forgo delays in land acquisition, statutory clearances, and interferences from NHAI etc as the concessionaire becomes more cautious, competent and accountable.