Abstract
Rail-based metro system is crucial for supporting a city’s expansion and growth. However, urban metro projects being capital intensive with long gestation and pay back periods may not be financially viable but socially desirable. More and more cities in India are announcing metro projects committing huge budgetary resources to these projects at the cost of sectors such as health and education. Given the huge requirement of capital and possibility of attracting willing as well as capable private investors to undertake urban transport projects, promoting public–private partnerships (PPPs) could be a key priority. However, none of the metro projects launched during past 7 years in India have been planned on PPP framework. International experience in PPP metro and our own Delhi airport metro experience have demonstrated that many issues can influence the successful implementation of PPPs in such projects. In this context, outcome of Hyderabad metro is keenly watched as it is one of the largest metro rail projects built under a PPP framework anywhere in the world. The paper reviews the research conducted on critical success factors (CSFs) that are necessary for adopting PPP models in urban metros in Indian context. Eighteen CSFs identified through literature survey have been validated in a pilot study through structured questionnaire and grouped in seven macro-factors through hierarchical cluster analysis. A case study has been attempted using SAP–LAP framework to analyse the identified CSFs in real-life settings of the first two stages of Hyderabad metro project. Key players working on the project were interviewed during a field study to gather feedback on actions they took on factors critical to success. Observations and findings have been synthesised as learnings for future such projects.
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Notes
Based on approved metro projects in Jaipur, Lucknow, Nagpur, Kochi, Ahmedabad, Bangalore, Mumbai, Hyderabad, Delhi, Kolkata, Chennai, Gurgaon, Pune and Noida up to 31 December 2016 (Source: MoUD).
Out of three stages of a metro project (pl refer “What Defines Success of a PPP Metro Project?” section), only contract success and implementation success up to the progress made till December, 2016 have been analysed as the ‘post-implementation success’ can be analysed only after commissioning of the project.
Up to the progress made till December, 2016.
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Appendix
Appendix
Exhibit-1 cluster analysis of 18 CSFs into 7 macro-factors
S. nos. | Micro-variablesa | Macro-variables | Type of factors |
---|---|---|---|
1 | Political/social environment/support | Socio-political environment | External |
Consultation with stake holders | |||
Multi-benefit objectives | |||
2 | Stable macroeconomic environment | Stable macro-economics and institutional, legal, framework | |
Financial market availability | |||
Institutional legal framework | |||
3 | Thorough cost–benefit assessment | Government support | |
Government support and guarantee | |||
3 | Capable and well-organised public agency | Good governance | Internal |
Good governance | |||
5 | Competitive and transparent procurement | Effective procurement | |
Strong consortium | |||
6 | Appropriate risk allocation and sharing | Well-structured PPP project | |
Contract agreement | |||
7 | Techno-economic feasibility of project | PPP implementation processes | |
Commitment, responsibility and defined role of partners | |||
Contract compliance for results | |||
Shared authority between public and private |
Exhibit-2 Success Criteria and Performance Indicators in a PPP Project
Success criteria | Performance indicators |
---|---|
1. Contract success | a. Quality and completeness of the contract |
b. Appropriate risk sharing and risk allocation | |
c. Selection of concessionaire and contract agreement | |
d. Financial closure within stipulated time | |
2. Implementation success | a. Timely project delivery |
b. Project completion within budget | |
c. Scope of the project as per contract | |
d. Quality of construction | |
3. Post-implementation success | a. Ridership recovery in short and long terms |
b. Last mile connectivity | |
c. Service quality in O&M | |
d. User satisfaction |
Exhibit-3 Key Questions
1. Who are the main actors involved in planning and implementation of Hyderabad Metro? |
2. Which critical factors have contributed to the success of Hyderabad metro in achieving contract success and financial closure? Have these factors contributed in the same way during implementation? |
3. What is your opinion on the concessionaire agreement for Hyderabad Metro with regard to complete clarity on the contract with respect to scope, time, deliverables, etc.? Do you think the risks in the project have been allotted to the party which is best placed to bear that risk? |
4. Please describe the role played by your counterpart in public/private agency. How it has affected the project positively? What in your opinion could have been done more or done differently? |
5. What obstacles/problems were faced in the start of the project and during implementation? What are the learning points with respect to concession agreement for PPP metro projects? |
6. What are the key learnings from implementation of Hyderabad metro? |
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Kulshreshtha, R., Kumar, A., Tripathi, A. et al. Critical Success Factors in Implementation of Urban Metro System on PPP: A Case Study of Hyderabad Metro. Glob J Flex Syst Manag 18, 303–320 (2017). https://doi.org/10.1007/s40171-017-0164-6
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DOI: https://doi.org/10.1007/s40171-017-0164-6