Date: 2024-03-07Category: Public Private Partnership in IndiaState: Union GovernmentCountry: India
Hiring of Transaction Advisor for the proposal of Development of Non-Revenue Water (NRW) monitoring and management in water supply system in Visakhapatnam
**Executive Summary**
This document is an Office Memorandum that forwards the Record of Discussion of the 19th Meeting of the Approval Committee regarding proposals from Greater Visakhapatnam Smart City Corporation Limited (GVSCCL) to hire Transaction Advisors under the IIPDF Scheme for water supply and management system projects. The meeting was held on 7th March 2024. The proposals were ultimately deferred or rejected, with requests for more clarity on project details.
**Key Points / Main Content**
* **Meeting Details:**
* 19th Meeting of the Approval Committee was held on 7th March 2024.
* Purpose: To consider GVSCCL proposals for hiring Transaction Advisors under the IIPDF Scheme for water projects.
* **Proposal 1: Development of Non-Revenue Water (NRW) monitoring and management in water supply system in Visakhapatnam.**
* Project involves monitoring NRW and enhancing the efficiency of water supply systems.
* Envisaged PPP Mode: HAM/DBFOT/EPC with O&M or any other suitable PPP model.
* Estimated TA Costs: Rs. 2,50,16,000/- (Rs.2.12 Cr + 18% GST).
* IIPDF Contribution sought: 100%.
* Current Status: RFP for engaging TA is yet to be floated.
* Outcome: The Approval Committee deferred consideration of the proposal, requesting clarity on project details and private partner roles.
* **Proposal 2: Enhance energy efficiency of water supply and wastewater systems for Greater Visakhapatnam Municipal Corporation (GVMC).**
* Project involves enhancing the energy efficiency of water supply and wastewater systems.
* Envisaged PPP Mode: HAM/DBFOT/EPC with O&M or any other suitable PPP model.
* Estimated TA Costs: Rs. 2,24,20,000/- (Rs. 1.90 Cr + 18% GST).
* IIPDF contribution sought: 100%.
* Current Status: RFP for engaging TA is yet to be floated.
* Outcome: The Approval Committee rejected the proposal as ESCO is a well-established model for the work, and PSA wants to do through PPP mode.
**Impact Analysis**
**GVSCCL, Government of Andhra Pradesh**
* **Impact:** The proposals for hiring Transaction Advisors for water projects have been deferred or rejected, hindering the immediate progress of these projects under the IIPDF Scheme.
* **Action Required:** Provide clarity on project details and private partner roles for the NRW monitoring project.
**PSA (Project Structuring Agency)**
* **Impact:** The PSA needs to provide a clearer vision of the project for the NRW Monitoring project.
* **Action Required:** For the NRW Monitoring project, the PSA must present clear project contours and scopes on PPP mode to the Approval Committee.
**Potential Transaction Advisors**
* **Impact:** Potential bidders for the Transaction Advisory roles are affected, as the RFP for the engagements is yet to be floated, and the proposals have been deferred or rejected.
* **Action Required:** Await further instructions and any revisions to the project proposals.
Key Entities Referenced
IIPDF Scheme: Infrastructure Investment Promotion and Development Fund Scheme, providing support for project proposals.
Greater Visakhapatnam Smart City Corporation Limited (GVSCCL): Entity submitting proposals for water supply and wastewater system projects in Visakhapatnam under the IIPDF Scheme.
Approval Committee: Committee responsible for considering and approving proposals under the IIPDF Scheme.
Visakhapatnam, Andhra Pradesh: Location where the proposed water and wastewater projects are planned.
Ministry of Finance, Department of Economic Affairs: Government body overseeing the Infrastructure Finance Secretariat and the IIPDF Scheme.
F. No. /9/2024-PIU
Government of India
Ministry of Finance
Department of Eeonomic Affairs
Infrastructure Finance Sccretariat
Infrastructure Support & Development Division
Private Investment Unit (PIU)
5Floor. Jawahar Vyapar Bhawan.
Tolstoy Marg. New Delhi
Dated 1s March 2024
Offiee Memorandum
Record of Discussion of the 19" Meeting of the Approval Committce to consider the
proposals of Greater Visakhapatnam Smart City Corporation Limited (GVSCCL),
Government of Andhra Pradesh for hirine Transaction Advisors under IIPDF Scheme.
The undersigned is directed to forward Record of Discussion of the 19th Mecting of the
Approval Committee to consider the proposals ol Grcater Visakhapatnam Smart City Corporation
Limited (GVSCCL), Government of Andhra Pradesh for undertaking water supply and
management system projects in Visakhapatnam on PPP mode. held on 7h March 2024 for
inlormalion and nccessary action.
2. This issue with thc approval of the Competent Authority.
(Anmol Waraich)
Assistant Dircctor
To
1.
Shri Partha Sarathi Reddy. Adviser, NITT Aayog
Sri CM Saikanth Varma. IAS Commissioner, GVMC and MD&CEO, GVSCCL.
Sri G. Ananda Rao, Manager. GVSCCL.
Sr. PPS to JS (ISID)
1V
Copy for information:
The Chicr Sccretary, Andhra PradeshRecord of Diseussion of the 19 Mecting of the Approval Committee to consider the
proposals of Greater Visakhapatnam Smart City Corporation Limited (GVSCCL),
(Government of Andhra Pradesh for hiring Transaction Advisors under IIPDF Seheme.
The 19" Approval Committee (AC) Meting chaircd by the Joint Sccretary, ISID Division,
Department of Fconomic Aflairs (1DA) was held on 7h March 2024 at 1530 hours to consider the
proposals submitted by GVSCCL, Government of Andhra Pradesh under the IIPDE Scheme. lList
of participants (atlendces) is placed at Annexure- 1.
On behalf of the Chair, Joint Dircetor (PlU) welcomed the attendecs to the 19 Mccting of
the Approval Committee and inlormed that two projeet proposals were rcceived írom Grcater
Visakhapatnam Smart City Corporatin Iimited (GvSCCL), Governnent of Andhra Pradesh, for
water sector. IFurther, Joint Diretor (PIU) informed that the proposal has been duly circulatcd to
all members of the Appraisal Committee (AC) and with the permission of the Chair, GvSCCI.
was invited to make a prescntation on the proposal.
Development of Non-Revenue WVater (NRW) monitoring and management in water
supply System in Visakhapatnam.
3 The proposal was lor monitoring Non-revenue waler and management of water supply
system in Visakhapatnam. GVSCCI jointly with GVMC has identificd the timely necd to
enhancc the cliciency the water supply systems by reducing
NRW, and intends on attracting private sector participation through a structured transaction
process to deploy a system for continuous monitoring and systemie reduction of NRW. A brie
overview oft he projcct is provided below:
Project Name Development of Non-Revenue Water (NRW) monitoring and
management in water supply system in Visakhapatnam
l'urpose of Assistancc PPP Trunsaction Advisorv (TA) Costs
Scctor Water Supl (Water & Sanitation)
Projcct Sponsoring Greater Visakhapatnam Smart City Corporation Limited
Authority (GVSCCL
|Location Visakhapatnam, Andhra Pradesh
PPP Mode Envisaged UAMIDBFOT EPC with 0&M/or any other PPP model as
|found suitable
Estimated 'TA Costs Rs. 2,50,16,000/- 1Rs.2.12 Cr+18% GSTI
(incl. of taxes)
|P'ayment Milestone As per IIPDE Scheme
Proposcd
UPDF contribution sought100%
(%)
Current Status RIP for engaging TA is yet to be loated
4 Afer detailed deliberations, it was observed that the PSA has no clarity on the projcct and
private part1ners role in the projct. The Approval Committee decided to defer consideration of theproject proposals for funding of TA costs under IIPDF Scheme and requested the PSA to come up
with clear project contours and scopes on PPP mode.
Enhance energy cfficieney of water supply and wastewater systems for Greater
Visakhapatnam Municipal Corporation (GVMC).
5. The proposal was about enhancing energy elliciency of water supply and wastewater
systems for GVMC. Water supply systems consume significant amounts of energy to pump water
from various sources to the treatment plant, reservoir, across the distribution network and to the
end users. GVMC spends a considerable portion of its budyet towards energy costs.
6 To develop the project, GVSCCL subnited the proposal under lIPDF scheme to hire
transaction advisers. The basic details of the projeet are outlined below.
Project Name Enhance energy eiticienevy of water supply and wastewater
Svstems for Greater Visakhapatnam Municipal Corporation
(GVMC).
Purpose of PPP Transaction Avisory (TA)Costs
Assistance
Sector Water Supply (Water & Sanitation)
Project Sponsoring Greater Visaklhapatnam Smart City Corporation Limited
Authority (GVSCCL
Location Visakhapatnam. Andhra Pradesh
PPP Mode Envisaged IAM/ DBFOT/EPC with OXM/or any other PPP model as
found suitable
Estimated TA Costs Rs. 2,24,20.000/ |Rs. 1.90 Cr 18% GST
(incl. of taxes)
Payment Milestone As per IIPDF Sheme
Proposed
IIPDF contribution 100%
sought (%)
Current Status | RIP lor engaging TA is yet to be lloated
8 GVSCCL was requested to make the prescntation about the proposal. Afier the
presentation, it was observed that ESCO (Energy Saving Companies) model is a well-established
model for the work. the PSA wants to do througlh PPP mode. Afier detailed deliberations, the
Approval Commitlee decided not to accept the proposal.
10. The meeting ended with vote of thanks to the Chair.Annexure-I
List of attendces of the 19 Mecting of the Approval Committee to consider granting approval for
support under the IIPDE Scheme to the proposal of Grcaler Visakhapatnam Smart City
Corporation Limited (GVSCCL), Government of Andhra Pradesh for undedre rtaking water supply
and management system projects in Visakhapatnam on PPP mode, held on 7h March 2024.
1. Department of Eeonomic Affairs, Ministry of Financc
1. Shri Baldeo Purushartha. JS(ISD) in Chair
2. Shri Rahul Singh, Joint Director
3. Ms. Aryaa Balan Kumari, Joint Dircetor
4. Shri Dhruv Rohatgi, OS)
5. Shri Gaurav Jumrani,Consultant
6. NITL Aayog
1. Shri Partha Sarathi Reddy, Adv iser (PPP)
7. Greater Visakhapatnam Smart City Corporation Limited (GVSCCL)
1. Sri M. Vinay Kumar, Superintending Engineer
2. Sri G. Ananda Rao, Manager