Program Semester Subject Code Book ID Subject Name

: MBA : III : PM0010 : BKID-1236 : Introduction to Project Management

Unit number
Unit Title Lecture Number Lecture Title

: 14
: Infrastructure Projects and Future of Project Management : 14 : Infrastructure Projects and Future of Project Management
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Unit-14

Infrastructure Projects and Future of Project Management

Infrastructure Projects and Future of Project Management

Objectives
The objectives of this lecture are to discuss: Characteristics of infrastructure projects Classification of a project as an infrastructure project Concept of Public-Private-Partnership (PPP) and Special Purpose Vehicle (SPV) Changing scenario of project management and role of Project

Managers

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Unit-14

Infrastructure Projects and Future of Project Management

Lecture Outline

Introduction

Infrastructure Projects
Concept of Public-Private-Partnership Special Purpose Vehicle - Typical Project Configuration Future of Project Management

Summary
Check Your Learning Activity

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Unit-14

Infrastructure Projects and Future of Project Management

Introduction
Good infrastructure is crucial for the economic progress of a country. Infrastructure provides the essential services to the public and private sectors. In India, infrastructure projects have traditionally been the province of government bodies.

Globalisation of economies enhances the challenge of infrastructure

development.

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Unit-14

Infrastructure Projects and Future of Project Management

Infrastructure Projects
Infrastructure projects promote economic activities They also ensure increased productivity

Example: Electricity, gas, water, highways, bridges, Metro transit

systems, airports and so on.

Financing Infrastructure in India: All projects need to long term debts for proper completion. Debt financing should be for a sufficient tenure. Available Long term debt is for a maturity period of 7 to 12 years.

Projects will have a project life of 25 years or more.

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Unit-14

Infrastructure Projects and Future of Project Management

Concept of Public-Private -Partnership

Private parties enable greater economic efficiency to achieve project schedule, project cost control, the facility operation and so on.

Public-Private-Partnerships (PPP) model aims to achieve the availability of

both private sector finance and high private sector techno-economic managerial talent.

Example: BOO (Build, Own, Operate) BOT (Build, Operate, Transfer) BOOT (Build, Own, Operate, Transfer)

BOLT (Build, Operate, Lease, Transfer)

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Unit-14

Infrastructure Projects and Future of Project Management

Special Purpose Vehicle (SPV) Typical Project Configuration

SPV enters a contractual arrangements with several parties collectively referred as Project Parties. Salient features with respect to SPV model: For financial viability of the project, the capital cost of the project should be kept to a minimum and realistic level. Some Key Project Parties are: Project sponsor (s) Project Lenders

O&M Contractor

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Unit-14

Infrastructure Projects and Future of Project Management

SPVTypical Project Configuration Contd

Key Project Contracts: Shareholders Agreement

EPC contract
Project Loan Agreements O&M Contract

Infrastructure Financing Scenario in India Operate, Maintain, Transfer (OMT) model is being adopted for roads

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Unit-14

Infrastructure Projects and Future of Project Management

Future of Project Management

Participative Management has become popular in corporate
management. Influence of Changes in the Environment of Project Management Globalisation, changing technology and IT.

Changing Role of Project Managers

Challenges faced by them: Multicultural understanding

Ethics in Project Management

Rightful conduct and moral principles that are accepted by majority of the members of society. Example: Actions like avoiding acceptance of gifts, preventing conflict of

interest and so on.

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Unit-14

Infrastructure Projects and Future of Project Management

Summary
Infrastructure provides the essential services to the public and private sectors. All projects need to long term debts for proper completion.

Private parties enable greater economic efficiency to achieve project schedule, project cost control, the facility operation and so on. For financial viability of the project, the capital cost of the project should be kept to a minimum and realistic level. Ethics denote rightful conduct and moral principles that are accepted by majority of the members of society.
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Unit-14

Infrastructure Projects and Future of Project Management

Check Your Learning

1. Define code of Ethics? Ans. Rightful conduct and moral principles that are accepted by majority

of

the

members

of

society.

Example:

Actions

like

avoiding

acceptance of gifts, preventing conflict of interest and so on. 2. What are Infrastructure projects?

Ans. These projects promote economic activities which are essential

for businesses to be competitive. Example: Electricity, gas, water, highways, bridges, Metro transit systems, airports and so on.

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Unit-14

Infrastructure Projects and Future of Project Management

Activity
Consider an Infrastructure project that is implemented to produce economic services from utilities such as communications. Analyse how this project assists in the productivity of the production.

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