{"id":95736,"date":"2026-03-31T15:16:17","date_gmt":"2026-03-31T09:46:17","guid":{"rendered":"https:\/\/vajiramandravi.com\/current-affairs\/?p=95736"},"modified":"2026-03-31T15:16:17","modified_gmt":"2026-03-31T09:46:17","slug":"kelkar-committee","status":"publish","type":"post","link":"https:\/\/vajiramandravi.com\/current-affairs\/kelkar-committee\/","title":{"rendered":"Kelkar Committee, Background, Recommendations, Impact"},"content":{"rendered":"<p><span style=\"font-weight: 400;\">The Kelkar Committee headed by Vijay Kelkar was constituted by the Union Finance Ministry in the Union Budget 2015-16 to address the growing challenges in the <\/span><b>Public-Private Partnership (PPP) model<\/b><span style=\"font-weight: 400;\"> in India. Many infrastructure projects in India were facing delays, financial stress, and contractual disputes under the PPP model. To revive investor confidence and improve project implementation, the committee suggested comprehensive reforms.<\/span><\/p>\n<h2><b>Kelkar Committee Background<\/b><\/h2>\n<ul>\n<li style=\"font-weight: 400;\" aria-level=\"1\"><span style=\"font-weight: 400;\">The PPP model was widely adopted in India for infrastructure development in sectors like roads, ports, airports, and power during the 2000s.<\/span><\/li>\n<li style=\"font-weight: 400;\" aria-level=\"1\"><span style=\"font-weight: 400;\">Over time, many PPP projects became stressed due to issues such as land acquisition delays, environmental clearances, and regulatory bottlenecks.<\/span><\/li>\n<li style=\"font-weight: 400;\" aria-level=\"1\"><span style=\"font-weight: 400;\">Private sector participation declined significantly as projects became financially unviable and risky.<\/span><\/li>\n<li style=\"font-weight: 400;\" aria-level=\"1\"><span style=\"font-weight: 400;\">There was an imbalance in risk-sharing between the government and private players, with most risks being borne by the private sector.<\/span><\/li>\n<li style=\"font-weight: 400;\" aria-level=\"1\"><span style=\"font-weight: 400;\">Frequent policy changes and lack of contractual clarity created uncertainty for investors and developers.<\/span><\/li>\n<li style=\"font-weight: 400;\" aria-level=\"1\"><span style=\"font-weight: 400;\">Dispute resolution mechanisms were slow and inefficient, leading to long-pending conflicts between stakeholders.<\/span><\/li>\n<li style=\"font-weight: 400;\" aria-level=\"1\"><span style=\"font-weight: 400;\">Banks and financial institutions faced rising <strong><a href=\"https:\/\/vajiramandravi.com\/current-affairs\/npa\/\" target=\"_blank\">non-performing assets<\/a><\/strong> (NPAs) due to stalled PPP projects.<\/span><\/li>\n<li style=\"font-weight: 400;\" aria-level=\"1\"><span style=\"font-weight: 400;\">The need was felt to restore investor confidence and revive infrastructure growth through reforms in PPP framework.<\/span><\/li>\n<li style=\"font-weight: 400;\" aria-level=\"1\"><span style=\"font-weight: 400;\">In this context, the Kelkar Committee was set up to review existing PPP mechanisms and suggest measures for their revival and improvement.<\/span><\/li>\n<li style=\"font-weight: 400;\" aria-level=\"1\"><span style=\"font-weight: 400;\">The committee focused on strengthening governance, institutional capacity, and financial sustainability of PPP projects.<\/span><\/li>\n<\/ul>\n<h2><b>Recommendations of the Kelkar Committee<\/b><\/h2>\n<p><span style=\"font-weight: 400;\">The recommendations of the Kelkar Committee focuses on improving governance, transparency, financing, and dispute resolution in infrastructure projects.<\/span><\/p>\n<ul>\n<li style=\"font-weight: 400;\" aria-level=\"1\"><b>Strengthening PPP Framework:<\/b><span style=\"font-weight: 400;\"> Focus on three pillars Governance, Institutions, and Capacity to make PPP projects more efficient and reliable.<\/span><\/li>\n<li style=\"font-weight: 400;\" aria-level=\"1\"><b>Establishment of 3PI (PPP Institute of Excellence):<\/b><span style=\"font-weight: 400;\"> A dedicated institution should be created to support research, training, and capacity building for PPP projects.<\/span><\/li>\n<li style=\"font-weight: 400;\" aria-level=\"1\"><b>Amendment to Prevention of Corruption Law:<\/b><span style=\"font-weight: 400;\"> The <strong><a href=\"https:\/\/vajiramandravi.com\/current-affairs\/prevention-of-corruption-act-1988\" target=\"_blank\">Prevention of Corruption Act, 1988<\/a><\/strong> should be amended to penalize corruption while protecting honest officials who make genuine decisions.<\/span><\/li>\n<li style=\"font-weight: 400;\" aria-level=\"1\"><b>Avoid Swiss Challenge Method:<\/b><span style=\"font-weight: 400;\"> This method should be avoided as it reduces transparency and discourages fair competition.<\/span><\/li>\n<li style=\"font-weight: 400;\" aria-level=\"1\"><b>Discouraging Unsolicited Proposals:<\/b><span style=\"font-weight: 400;\"> Such proposals should be minimized as they create unequal opportunities among bidders.<\/span><\/li>\n<li style=\"font-weight: 400;\" aria-level=\"1\"><b>Innovative Financing Mechanisms:<\/b><span style=\"font-weight: 400;\"> Banks and financial institutions should issue <\/span><b>deep discount bonds (zero coupon bonds)<\/b><span style=\"font-weight: 400;\"> to provide long-term, low-cost funding and reduce initial financial burden.<\/span><\/li>\n<li style=\"font-weight: 400;\" aria-level=\"1\"><b>Equity Divestment After Project Completion:<\/b><span style=\"font-weight: 400;\"> After successful completion, project equity can be sold to long-term investors, including foreign institutional investors, to fund new infrastructure projects.<\/span><\/li>\n<li style=\"font-weight: 400;\" aria-level=\"1\"><b>Independent Sectoral Regulators:<\/b><span style=\"font-weight: 400;\"> Set up independent regulators in sectors adopting PPP to ensure fair decisions and reduce political or bureaucratic interference.<\/span><\/li>\n<li style=\"font-weight: 400;\" aria-level=\"1\"><b>Unified Regulatory Approach:<\/b><span style=\"font-weight: 400;\"> Regulators should follow a consistent and coordinated approach across sectors.<\/span><\/li>\n<li style=\"font-weight: 400;\" aria-level=\"1\"><b>Revision of Model Concession Agreement (MCA):<\/b><span style=\"font-weight: 400;\"> Risk-sharing provisions should be revisited to ensure balanced allocation of risks instead of a \u201cone-size-fits-all\u201d model.<\/span><\/li>\n<li style=\"font-weight: 400;\" aria-level=\"1\"><b>Protection to Private Sector:<\/b><span style=\"font-weight: 400;\"> Private players should be safeguarded against sudden policy changes or economic shocks.<\/span><\/li>\n<li style=\"font-weight: 400;\" aria-level=\"1\"><b>PPP Law Framework:<\/b><span style=\"font-weight: 400;\"> A comprehensive PPP law should be enacted with Parliamentary approval to provide clarity, authority, and accountability.<\/span><\/li>\n<li style=\"font-weight: 400;\" aria-level=\"1\"><b>Infrastructure PPP Project Review Committee (IPRC):<\/b><span style=\"font-weight: 400;\"> Should be established to review stressed projects and provide time-bound recommendations.<\/span><\/li>\n<li style=\"font-weight: 400;\" aria-level=\"1\"><b>Infrastructure PPP Adjudication Tribunal (IPAT):<\/b><span style=\"font-weight: 400;\"> A specialized tribunal should be created for speedy dispute resolution.<\/span><\/li>\n<li style=\"font-weight: 400;\" aria-level=\"1\"><b>Efficient Dispute Resolution System:<\/b><span style=\"font-weight: 400;\"> A flexible and quick mechanism is needed to resolve conflicts and allow restructuring of projects when required.<\/span><\/li>\n<li style=\"font-weight: 400;\" aria-level=\"1\"><b>Limit Role of Public Sector in PPP Bidding:<\/b><span style=\"font-weight: 400;\"> State-owned enterprises and PSUs should not compete in PPP projects, as the model is intended to leverage private sector efficiency.<\/span><\/li>\n<li style=\"font-weight: 400;\" aria-level=\"1\"><b>Expansion to New Sectors:<\/b><span style=\"font-weight: 400;\"> PPP model should be extended to healthcare, social sectors, and urban transport.<\/span><\/li>\n<li style=\"font-weight: 400;\" aria-level=\"1\"><b>Avoid PPP for Small Projects:<\/b><span style=\"font-weight: 400;\"> PPP should not be used for small-scale projects due to high transaction and administrative costs.\u00a0<\/span><\/li>\n<\/ul>\n<h2><b>Impact on Infrastructure Development<\/b><\/h2>\n<p><span style=\"font-weight: 400;\">The recommendations of the Kelkar Committee, chaired by Vijay Kelkar, aim to transform infrastructure development in India by making the <strong><a href=\"https:\/\/vajiramandravi.com\/upsc-exam\/public-private-partnership\/\" target=\"_blank\">Public-Private Partnership<\/a><\/strong> (PPP) model more efficient, transparent, and sustainable.<\/span><\/p>\n<ul>\n<li style=\"font-weight: 400;\" aria-level=\"1\"><b>Revival of Stalled Projects:<\/b><span style=\"font-weight: 400;\"> Mechanisms like the Infrastructure PPP Project Review Committee (IPRC) help resolve stressed projects, leading to faster completion of delayed infrastructure works.<\/span><\/li>\n<li style=\"font-weight: 400;\" aria-level=\"1\"><b>Improved Investor Confidence:<\/b><span style=\"font-weight: 400;\"> Clear policies, better risk-sharing, and legal protection encourage private and foreign investors to participate in infrastructure projects.<\/span><\/li>\n<li style=\"font-weight: 400;\" aria-level=\"1\"><b>Better Risk Allocation:<\/b><span style=\"font-weight: 400;\"> Balanced distribution of risks between government and private players reduces financial stress and project failures.<\/span><\/li>\n<li style=\"font-weight: 400;\" aria-level=\"1\"><b>Faster Project Execution:<\/b><span style=\"font-weight: 400;\"> Streamlined approval processes and strong governance reduce delays caused by bureaucracy and regulatory hurdles.<\/span><\/li>\n<li style=\"font-weight: 400;\" aria-level=\"1\"><b>Enhanced Transparency and Accountability<\/b><span style=\"font-weight: 400;\">: Regulators minimize corruption and improve trust in the system.<\/span><\/li>\n<li style=\"font-weight: 400;\" aria-level=\"1\"><b>Access to Long-Term Financing:<\/b><span style=\"font-weight: 400;\"> Innovative instruments like zero-coupon bonds ensure availability of low-cost funds, improving project viability.<\/span><\/li>\n<li style=\"font-weight: 400;\" aria-level=\"1\"><b>Reduction in Non-Performing Assets (NPAs):<\/b><span style=\"font-weight: 400;\"> Timely completion and restructuring of projects help reduce bad loans in the banking sector.<\/span><\/li>\n<\/ul>\n","protected":false},"excerpt":{"rendered":"<p>Kelkar Committee reforms aim to revive PPP projects in India by improving governance, risk-sharing, financing, and dispute resolution to boost infrastructure growth.<\/p>\n","protected":false},"author":27,"featured_media":95662,"comment_status":"closed","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"_acf_changed":false,"footnotes":""},"categories":[786],"tags":[5267,6489],"class_list":{"0":"post-95736","1":"post","2":"type-post","3":"status-publish","4":"format-standard","5":"has-post-thumbnail","7":"category-general-studies","8":"tag-indian-economy","9":"tag-kelkar-committee","10":"no-featured-image-padding"},"acf":[],"_links":{"self":[{"href":"https:\/\/vajiramandravi.com\/current-affairs\/wp-json\/wp\/v2\/posts\/95736","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/vajiramandravi.com\/current-affairs\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/vajiramandravi.com\/current-affairs\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/vajiramandravi.com\/current-affairs\/wp-json\/wp\/v2\/users\/27"}],"replies":[{"embeddable":true,"href":"https:\/\/vajiramandravi.com\/current-affairs\/wp-json\/wp\/v2\/comments?post=95736"}],"version-history":[{"count":4,"href":"https:\/\/vajiramandravi.com\/current-affairs\/wp-json\/wp\/v2\/posts\/95736\/revisions"}],"predecessor-version":[{"id":95794,"href":"https:\/\/vajiramandravi.com\/current-affairs\/wp-json\/wp\/v2\/posts\/95736\/revisions\/95794"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/vajiramandravi.com\/current-affairs\/wp-json\/wp\/v2\/media\/95662"}],"wp:attachment":[{"href":"https:\/\/vajiramandravi.com\/current-affairs\/wp-json\/wp\/v2\/media?parent=95736"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/vajiramandravi.com\/current-affairs\/wp-json\/wp\/v2\/categories?post=95736"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/vajiramandravi.com\/current-affairs\/wp-json\/wp\/v2\/tags?post=95736"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}