Governance issues in BOT based PPP infrastructure projects in India

Abstract

Purpose The aim of this paper is to identify the combinations of economic, normative, reputational and cognitive mechanisms that can prevent post‐award governance challenges on build‐operate‐transfer (BOT) projects in India. Design/methodology/approach The paper uses an empirical, case‐study based methodology to collect data and analyzes the cases through the use of the qualitative comparative analysis (QCA) technique. The paper first identifies and classifies the various kinds of governance challenges and preventive mechanisms in BOT projects based on the extant literature. Empirical evidence on 11 BOT projects in India is gathered and QCA is employed to unearth the linkages between specific governance mechanisms and post‐award challenges on these projects. Findings Project governance issues were identified across two dominant interfaces – one between the public and private sector and the other between the project and the societal stakeholders. Governance mechanisms based on providing shared incentives combined with the capacity to administer projects are effective in combating governance challenges across the public‐private sector interface. Cognitive mechanisms which make the project more accountable to the societal stakeholders are most effective across the project‐stakeholder interface. Research limitations/implications These findings can be validated on larger data sets, across geographies, sectors and variety of PPP projects – currently the authors have only studied the BOT variant of PPPs. Practical implications The authors’ “contingency” approach to governance can help decision makers select specific governance mechanisms based on a project's structure and risk profile to better ensure successful delivery of a BOT project's objectives. Originality/value Post‐award governance of PPP projects is a theme that has received comparatively little attention in the extant literature. Further, while post‐award issues as well as governance mechanisms have been separately identified, very little work exists that links these two sets of constructs. This paper seeks to contribute to knowledge in this area by proposing some preliminary findings on the link between post‐award issues and governance mechanisms. In addition, the paper employs an innovative technique called QCA to analyze the case‐study data.

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