A guidebook on public-private partnership in infrastructure

CHAPTER 3 
PROJECT DEVELOPMENT I: 
UNDERTAKING THE PREPARATORY ACTIVITIES 
Key Tasks 
The key tasks in this stage would involve: 
• Project identification and preliminary internal stakeholder 
consultation
• Scoping the project 
• Identifying the major issues in project planning 
• Assessing institutional due diligence 
• Establishment of a project management structure 
• Appointing a transaction advisor 
• Establishing a mechanism for public participation and information 
disclosure
 
A. PROJECT IDENTIFICATION AND
PRELIMINARY INTERNAL
STAKEHOLDER CONSULTATION
There are established procedures in identifying and preparing a portfolio of 
potential PPP projects in many countries (such as in the Republic of Korea). The 
implementing agencies consider projects on the basis of such a portfolio. In the 
absence of such a portfolio, the project ideas may originate from existing plans or 
studies, or from political commitments of the government. 
After developing a project, the concerned implementation agency in the 
government invites proposals from the private sector for its implementation through a 
procurement process. The proposals submitted by private parties in response to 
such a request are called solicited proposals. This Guidebook focuses on project 
development for solicited proposals. 
Sometimes, private parties may also submit proposals without any request 
from the government. Such proposals are called unsolicited project proposals. The 
procedure for handling such projects are different and are briefly discussed in a 
separate section in Chapter 4.
A number of government departments and agencies may be directly or 
indirectly involved in the implementation of a PPP project. It is important to ensure 
their participation in the process from the very beginning. Valuable inputs may be 
received from them in developing a project. Previous experience of other agencies in 
PPP project implementation can also greatly help in structuring a viable project. 
A PPP project may require approval and concurrence of a number of 
government agencies and regulatory bodies. They may include Ministries of 
Planning and Finance, the concerned sectoral Ministry, Department of Environment, 

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A Guidebook on Public-Private Partnership in Infrastructure 
21 
 
Board of Investment, Central Bank, etc. A project may also require various licences 
and permits from many agencies – for example, the concerned sector regulator and 
local government.
The project implementing agency needs to identify all such stakeholders in 
the government and start preliminary consultation with them concerning the project. 
A coordination mechanism with all such agencies could also be considered. 
At this stage, it is equally important to identify stakeholders from outside the 
government, such as sector experts, local residents and various user groups, and 
interested and potential private providers of the project who could be consulted later 
on in the process. If there is no established mechanism for consultation with all the 
stakeholders, an appropriate mechanism needs to be considered at the outset.