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What is Model Concession Agreement?

What is Model Concession Agreement?

In India, public-private partnership (PPP) projects are based on MCA, a legal contract.
It specifies the conditions under which a road project can be carried out until a private company is established.
It describes the legal and policy framework for putting a PPP project into action.
The mitigation and unbundling of risks, the allocation of risks and returns, the symmetry of obligations between the principal parties, and the precision and predictability of costs and obligations are just a few of the issues that MCA addresses in relation to a PPP framework.
The model can be used in a variety of fields, including ports, urban rail transit, state highways, and national highways.

About Public Private Partnership:

A government agency and a private company work together in a public-private partnership to finance and manage projects like parks, convention centers, and public transportation networks.
It frequently entails tax breaks, liability protection, and partial ownership rights over nominally public services and property to private, for-profit organizations.

Advantages:

Ensure the necessary investments in the public sector and efficient management of public resources.
improve the quality and promptness of public service delivery.
The opportunity to receive a long-term payment is made available to a private organization.
The implementation of PPP projects makes use of the expertise and experience of the private sector.
Risk allocation for PPP projects makes it possible to cut costs associated with risk management.
Demerits:

It’s possible that the infrastructure or services that are provided will cost more. The service procurement process is longer and more expensive than traditional public procurement.
Due to the inability to anticipate events that could influence the subsequent activity, the project agreements are rigid and of a long duration.

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