Do you think public-private partnerships (PPPs) are a good idea? Give three benefits and three drawbacks to the private acquisition of the Indiana Tollway. Long-term leases are becoming increasingly common.
Two recent high profile longterm leases are the Chicago Skyway toll road and the Indiana Tollway. The former is an 8-mile, highly traveled (50,000 vehicles per day) toll road, the lease for which was sold for $1.8 billion, whereas the latter is a 157-mile toll road that traverses the state of Indiana and was sold for $3.8 billion. As part of the lease agreement, the private companies can collect tolls in exchange for maintaining and operating the road. These two leases are long-term (99 and 75 years respectively). These leases were also noteworthy (and controversial) due to the fact that the leasers were foreign-based investment companies. However, these sources of funds are very attractive to states and cities that are struggling with budget shortfalls, as leasing the roadway provides a significant upfront payment that can be used for other infrastructure project
Yes, Why not ? Public-Private Partnership is a good idea. As it increases the opportunity & resources as well as quality of work. As we know "Government has no buisness to do business" so we can say that all the business should be in private hands but to maintain the social and economic equilibrium or balance government should have to participate in them so that rich is not getting richer and poor is not getting poor.
Benefits of Private Acquisition of the indiana tollway : -
1. It has the potential for low risk benefits.
2. We have more budget.
3. It has a tax benefit also if government want to do this project by self then they have to pay from country treasure in which money is of taxpayers.
Drawbacks of private acquisition of Indiana tollway :-
1. Costly traffic diversion which affect the user.
2. Reduction in inheritance of government.
3. Main motive is to generate revenue not to give services which leads to unfair activities by them.
Foreign Direct Investment (FDI) is a good option if the country is facing the problem of money resource but if country has adequate money resources than FDI option should be ignored ,priority should be given to country resources so that country resources can be utilized effectively and charges of import of resources can be saved and in this case it is ok to handover both the tollways to foreign based private firm but this type of contract should be smaller period means the lease should not exceed 50 years and preferably keep it 25 years or 30 years ( as we know most of the companies don't take lease of less than 50 years than in this situation some clear clause should be added to compensate drawbacks ) and after this lease period if country has their own resources then they can use them otherwise increase the lease period.
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Do you think public-private partnerships (PPPs) are a good idea? Give three benefits and three drawbacks...
Do you think public-private partnerships (PPPs) are a good idea? Give three benefits and three drawbacks to the private acquisition of the Indiana Tollway. Long-term leases are becoming increasingly common. Two recent high profile longterm leases are the Chicago Skyway toll road and the Indiana Tollway. The former is an 8-mile, highly traveled (50,000 vehicles per day) toll road, the lease for which was sold for $1.8 billion, whereas the latter is a 157-mile toll road that traverses the state...