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Abstract— With changing time and needs it is important to The models such as Build Operate Transfer (BOT), Build Own
evolve newer and better techniques and procurement methods to Operate Transfer (BOOT), Build Operate Lease Transfer
meet the growing demand of Infrastructural and social (BOLT), Operate Maintain Transfer (OMT), Viability Gap
development projects which are critical inputs necessary for the Funding (VGF), Design Build Operate (DBO), Built Own
continued growth of the Indian economy. Swiss Challenge
Method is globally recognized procurement method based on
Operate (BOO) etc. have not only encouraged the private
PPP Modal which provides an opportunity to private sector to players to forge a partnership with government and build
conceive an innovative unsolicited project proposal in India quality infrastructure, but also increases the economic
under the State and Central government. Governments in India activities in the State. In a developing state like Maharashtra,
had implemented various projects under Swiss Challenge Haryana, Madhya Pradesh, Rajasthan & Karnataka where
Method. Various State governments of India had proposed infrastructural development is of paramount significance, an
guidelines to adopt the Swiss Challenge Method for project initiative by private players for new unidentified projects
procurement/execution for development works to strengthen might prove very helpful in achieving the objective. With this
private and public sector participation. A comparative study was
view to present the bankable projects to private & public
conducted based on State guideline and procedure adopted in
Indian states of Maharashtra, Haryana, Madhya Pradesh, sector and for improving the level of infrastructure in the state
Rajasthan and Karnataka. A comparison was made based on and for matters connected therein or incidental thereto, the
Preliminary Detail of Proposal required, Content requirement of state Governments has proposed guidelines to adopt the Swiss
pre-feasibility study report, Content of detailed project report, Challenge Method for projects execution/procurement for
Project financial summary and Time frame allotted. An attempt development works towards private and public sector
was also made to identify eligible sectors, advantages and participation.
weaknesses of Swiss Challenge Method.
Keywords—Swiss Challenge Method(SCM); Public Private
Partnership (PPP); Unsolicited Proposal; Unsolicited Project
Proponent (USPP);Original Project Proponent; Suo-Motu II. LITERATURE REVIEW
Proposal; Directorate of Institutional Finance (DIF); State Level In the global infrastructure market, unsolicited public-
Executive Committee (SLEC). private partnership (UPPP) proposals have been promoted and
a number of countries have established incentive programs to
I. INTRODUCTION encourage such proposals (ABDEL AZIZ & NABAVI,
Over the years, there has been an increase in private sector 2014[1]).Infrastructural and social development projects were
participation in developing countries to fill the growing identified as critical inputs for continuing growth of the Indian
“Infrastructure gap” between the demand and supply. India is economy. The governments of India intend to provide an
a developing country and there is need to provide rapid opportunity to the private sector to conceive an innovative
development of infrastructure and social sector projects in project and submit the project report for consideration under
various Indian States and attract private and public sector Swiss Challenge Method (SCM) (Podile and Rao,2017 [2]).
participation in the planning, designing, financing, India was one of the leading Market for PPP Investment, and
construction, operation and maintenance of projects. Rapidly that the Indian government fully supported PPP development
growing economy, increased industrial activity, increased in the country (India PPP Submits, 2017[3]). To provide rapid
population pressure has led to greater demand for better development of infrastructure and social sector projects in the
quality and coverage of water and sanitation services, state and attract private and public sector participation, the
sewerage and drainage systems, solid-waste management, Government of Haryana had proposed to adopt the Swiss
railways, roadways, airports, seaports, power supply, Challenge Method for project procurement for development
communication networks etc. To meet these requirements, works in the State (SCM Guideline GoH, 2016 [5]). To present
governments are utilizing the capabilities of the private sector the bankable projects to private & public sector and for
in a big way. In last few decades, various states of India has improving level of infrastructure in the state and for matters
introduced and implemented various infrastructure projects connected there in or incidental there to, the Government of
under innovative Public Private Partnership (PPP) models. Madhya Pradesh had proposed the SCM approach towards
private and public sector participation (SCM Guideline GoMP, B. Objectives
2014[6]). The Swiss Challenge Method is a method in which an Initiation in spotting an unidentified need and provide
unsolicited proposal for a government project is received and solution for the same.
allows third party to challenge the original proposal through To bring in technology, finance & expertize in
open bidding, and then lets the original proponent counter- execution among others.
match the most advantageous / most competitive offer (RTPP,
To encourage induction of new technology and
Rule no. 15, GoRJ, 2013[7]). In the case of a USP, a private-
promotion of unique solutions.
sector entity (USPP) reaches out to the government with a
To provide financially sustainable unique solutions.
proposal to develop an infrastructure project, without an
To augment public private partnerships in
explicit request from the government to do so (PPIAF, Vol
sectors/projects which are not covered under the
III[9]). “Risk Sharing and Mitigation Strategies” were the most
current PPP Framework.
significant in unsolicited projects. In addition, “Inter
organization Coordination” among project participants was
essential to the success for unsolicited projects (Sungmin Yung IV. COMPARISON OF COMMON FORMS OF PPP
and etal, 2015[10]). Seven critical strategies for managing MODAL WITH SCM
unsolicited PPP proposals: existence of well-structured and
TABLE I. Comparison of Various PPP Modal with SCM
clear policy guidelines for unsolicited proposals; thorough
assessment of value for money, innovation, cost and risks of
proposals; employment of highly skilled and competent staff
during evaluations of proposals; competitive, fair, and
transparent tendering process; extensive public consultation
and stakeholder engagement; comprehensive evaluation of the
impact of unsolicited proposals on sector/national policy; and
adequate protection of intellectual property rights of the
original proponent (Robert Osei-Kyei and etal, 2018[11]).
Unsolicited proposals, when subject to competition and
transparency, may contribute to the overall infrastructure goals
of countries, particularly where governments have low
technical and financial capacity to develop projects
themselves, (Hodges and Dellacha, 2007[12]).
TABLE III. Content of pre-feasibility study report TABLE IV. Format for submission of detailed proposal by Project
Proponent
(M-Maharashtra, HR-Haryana, MP-Madhya Pradesh, RJ-Rajasthan, KA- Karnataka)
(M-Maharashtra, HR-Haryana, MP-Madhya Pradesh, RJ-Rajasthan, KA- Karnataka)
TABLE V. Content of Detailed Project Report
TABLE VI. Project Financial Summary
internal project approval process, and the second on a competitive
tender to determine the final project developer and operator.
Stage 1: Approval.
Unsolicited proposals through Swiss Challenge method are
approved in a three-step process:
Step1: The private proponent first submits a preliminary
description of the project to the appropriate government
agency or Authority. After a stipulated review period, the
responsible agency or Authority gives permission to the
proponent to proceed for preparation of detailed proposal,
usually after assessing whether the project serves a “public
interest” or fits in the strategic infrastructure plan.
Step2: If the initial project description receives preliminary
acceptance, the proponent is usually given formal recognition
for the concept and allotted specified period to present a full,
detailed proposal.
Step3: The detailed proposal is examined by the concerned
authority followed by preparation of bid document by the
respective department and approval from the competent
Authority.
(M-Maharashtra, HR-Haryana, MP-Madhya Pradesh, RJ-Rajasthan, KA- Karnataka) SCM can be adapted to any sectors approved by SLEC such
The guidelines envisage the time frames for procurement as: Agriculture, Horticulture, allied sector & post-harvest
through SCM for key activities which is broadly divided management, Education including Technical Education (Skill
into to two main stages, the first focuses on the government’s development etc.), Gas distribution network, Health,
Highways & Bridges, Housing & Environment, Information
Technology, Inland water transport & Water Body Eco-system This method is Potential route for furthering local
Management, Industrial infrastructure, Irrigation, Land projects that are not national priorities.
Reclamation, Logistics, New & Renewable Energy (solar, Transparency can be ensured in bidding process.
wind, hydel etc.), Power sector, Public Transport, Public
Buildings, Markets, Gardens, Parks and parking facility, Weaknesses of Swiss Challenge Method are as follows
Sanitation, Sewerage, Drainage etc., Sports and Recreation There are risks of insufficient transparency and
Infrastructure, Trade Fair, Convention, Exhibition and Cultural inadequate competition in the Swiss Challenge Method.
Centers, Tourism, Urban Development, Waste Management, There is no legal validity of using this method when a
Water Supply Project counter proposal contains different specifications than
Up-gradation and restructuring of any of the projects in the original proposal.
above sectors There is no symmetry in bidding time given to bidders
Any other projects which is a combination of above to prepare counter proposals in relation to time taken by
mentioned sectors originator for preparation
Any project in public-private partnership that the It is very difficult to measure monetary value of
Government may find beneficial. unsolicited proposal when contract or project is not
Any proposal for the partial or complete disinvestment given to original proponent.
of a state public sector undertaking. There is no guarantee that unsolicited bidder won’t
A project which is innovative or involves proprietary withdraw its offer.
technology or franchise which is exclusively available
with the person globally.
XI. CONCLUSION
A project wherein competitive public bidding has failed
to select a developer. When it comes to infrastructure projects, “Swiss Challenge
A project to provide social services to the people Method” (SCM) represents an alternative to the traditional
including community services and public utilities. project initiation method where the private sector, rather than
the government, takes the leading role in identifying and
An infrastructure project which is an essential link for
developing a project. Governments in India have centralized
another bigger infrastructure project owned or operated
their SCM submission processes, either: requiring a central
by the same person.
government agency to accept and process SCM or allowing
Any new sector can be added to the list of “eligible state government departments to accept SCM but requiring the
sectors” of these guidelines, only after the consent of the State level Executive Committee to process and evaluate them.
Government on the recommendations of the SLEC. In India, various State government across the nation resorted
to SCM motivated by the perspective of solving the challenges
X. ADVANTAGES AND WEAKNESS OF SWISS CHALLENGE brought by their lack of capacity to identify and develop
METHOD projects. State governments believe that SCM will enable
them to take advantage of private-sector innovation and
The following are the benefits of using the SCM:
creativity, resulting in efficiencies in delivering infrastructure
Certainty of success under this methodology is ensured projects. The States and Central Government developed
as at least one willing private partner is available right several guidelines on the subject to maintain transparency,
from the beginning. fairness, governance, and competition along with proper
The project proponent does a detailed feasibility & guidance to project proponents and concerned departments.
financial analysis of a project resulting in better project The study of various literature and guidelines has helped in
structuring. The initial structuring by the project comparison of submission requirement, Evaluation method
proponent brings in efficiency and better understanding adopted by department, project development and project
of financial implication resulting in development of procurement phases. Implementation of a SCM will be more
economically sustainable model. convenient, easier and faster than the implementation of a
The identification of timelines, identification of risks publicly initiated PPP project. Almost every core infrastructure
and their allocation along with transparent bidding sector is included under SCM in India.
criteria becomes easier for the authority as the project
preparation is done in more professional manner.
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