SPVs in Karnataka to go local with no bidders
The special purpose vehicles (SPVs) of the proposed tier-II smart cities Hubballi-Dharwad, Shivamogga, Davanagere, Belagavi, Tumakuru and Mangaluru are now looking for local contractors to implement their projects as no bidder is coming forward to invest.
The SPVs are mooting investor’s meets to provide a platform for both local and non-Karnataka contractors to come forward to implement the projects. The SPVs have finalised projects and are inviting tenders to execute them. However, bidders are reluctant to take up both public private partnership (PPP) and non-PPP projects.
PPPs are important for bringing capital and private sector efficiencies to urban infrastructure projects. The Smart City Mission document states that PPPs are commercial transactions between a public and a private party by which the private party performs a function traditionally performed by the public sector for an extended period of time, assumes related construction, commercial and operational risks, and receives a benefit in exchange, either by way of public authority paying from its budget or user fees, or a combination of these.