The UN World Water Development Report 2016, Water and Jobs: A Critical Review

In the article we examine the institutional process in a regional economy connected with the infrastructure development. The hypotheses stated are the following: 1) the existence of the interrelationship between the economic growth and attracting the investment into infrastructure; and 2) the influence of the institutional environment on the public-private partnerships (PPP) development. We have adopted the neoinstitutional approach to study the factors which influence the behavior of the government and business in their interaction in the economy. We also employ statistical methods for analyzing the dynamics of socio-economic development (SED) indicators of the subjects of the Russian Federation as well as the results of measures to attract private investment into infrastructure, including the PPP. The best regional practices were shown in creating an institutional environment for investors and implementing infrastructure projects. Also we propose new indices for assessing the attraction of private investments in infrastructure and for assessments of the regional SED. We chose the city of Moscow and the Yamalo-Nenets AutonomousDistrict as two empirical case studies, which differ in the economic and geographic conditions, but both demonstrate success in attracting private investment and implementing infrastructure projects. The existence of a relationship between indicators of private investment in public infrastructure and economic growth was revealed. In addition, in both regions there proves to be an interrelationship between the creation of the institutional environment and the emergence of new PPP projects. Against the background of institutional changes, there is a growth in private investment in infrastructure, and the share of non-budgetary funding in government programs increases. Our conclusions are consistent with a theory that asserts the primacy of institutional environment in relation to project implementation. In conclusion we make some practical recommendations for the development of the institutional environment which are acceptable for all regions solving similar problems of infrastructure development.

This study investigates the relationship between infrastructure investment and economic growth at the aggregate and sectoral levels, namely, the industrial, agriculture, and services sectors for Pakistan over the period from 1972 to 2015. In contrast to earlier literature, we make a comparative analysis of the different composition of infrastructure investments, including public versus private investment and infrastructure investment in sub-sectors such as in power, roads, and telecommunication sectors. The long-run relationship is estimated using fully modified ordinary least squares (FMOLS) to address the problem of reverse causality. The main conclusion of this study is that both public and private infrastructure investments have positive but different effects on economic growth. In other words, the marginal productivities of private and public infrastructure investments differ across the different sectors of the economy. In most of the cases, public infrastructure investment has a larger impact on economic growth than private infrastructure investment. Two important policy implications emerge from this study, as follows: (1) The different elasticity estimates can be used by policy makers to quantify the impact of policies targeted at the specific sector and (2) the government should develop an enabled policy environment to attract private investment, with the consideration of structural characteristics of the various sectors. The involvement of the private sector in the provision of infrastructure would help to control the tight budgetary situation.

During the late 1970s and early 1980s, many African countries experienced a profound slowdown in economic growth. The growth rate of real per capita GDP fell from 0.4% per year during the 1973-80 period to 1.2% per year during the 1980-89 period.' The causes-internal and external-of Africa's economic decline and the strategies for restoring economic growth are much debated. Nevertheless, broad consensus has emerged on the importance of (i) increasing total investment and (ii) promoting private-sector development and increasing its share of total investment for long-term growth.2 It is widely recognized that gross domestic investment fell substantially in Africa during the 1980s and remains severely depressed across the region. The proportion of total domestic investment in GDP fell from 20.8% per year during 1973-80 to 16.1% per year during 1980-89. In some countries, investment has fallen to less than 10% of GDP-a level that is insufficient even to replace depreciated capital. In Africa, the minimum investment needed to replace depreciated capital is estimated at 13% of GDP.3 In recent years, there has also been a growing recognition among many African leaders, faced with new realism and pragmatism, that the private sector could play a significant role in economic development. The focus in the longer term of structural adjustment programs and sectoral reforms adopted by these countries is on creating more appropriate incentives and a framework for private-sector development as the basis for achieving sustainable economic growth. In addition, multilateral and bilateral institutions have developed new initiatives with priorities for private-sector development. In 1989, the International Finance Corporation, an affiliate of the World Bank, es-

In India, infrastructure facilities such as roads, railways, ports, power stations, and information and communications technology (ICT) have not been developed sufficiently to catch up with India's rapid economic growth. Inefficient infrastructure has been pointed out as being a supply-side bottleneck. India must improve both its hard and soft infrastructure. The central government doubled its investment in the infrastructure sector from $US 500 billion in the 11th Five Year Plan (2007–2008 to 2011–2012) to $USD 1 trillion in the 12th Five Year Plan (2012–2013 to 2016–2017). But the investment is not enough to meet infrastructure financing. Public–private partnerships (PPP) were encouraged to mobilize more savings from the private sector. Commercial banks and non-banking financial companies (NBFCs) have been the two major source of non-budget debt financing for infrastructure projects. The share of infrastructure in gross bank credit rose from 6% in March 2007 to 11% in March 2011. However, banks face asset liability mismatches because they finance long-term infrastructure loans through deposits of a shorter maturity. Moreover, the share of gross non-performing loans (NPL) and restructured standard advances to the infrastructure sector in total advances to the sector increased from 5.1% in March 2010 to 22.8% in March 2015. Banks are reluctant to extend credit to the infrastructure sector. The total resources of NBFCs are limited because they are not deposit taking institutions. The private sector cannot depend on banks and NBFCs to expand investment in infrastructure projects. Singh and Kathuria (2016) recommend a strengthening of the bond market and mobilizing insurance and pension funds through the bond market to finance private investment in infrastructure. In India, PPP projects fell in the 12th Five Year Plan period. Many projects have suffered large time and cost overruns, and they have been unable to meet expectations regarding transparency and accountability. Many large infrastructure companies have accumulated debt. As the net debt of Indian infrastructure companies increased from 3 trillion rupees in 2010 to over 6 trillion rupees in 2014, private investment in infrastructure decreased from over $US 70 billion to less than $US 20 billion during the same period (Wall Street Journal 2015). While the Ministry of Road Transport and Highways has awarded contracts for 8000 km of national highways in 2014–2015, only about 700 km was awarded on build-operate-transfer (BOT) (Live Mint 2015). Infrastructure development through PPPs has reached a dead end. It seems that infrastructure financing as well as the institution of PPPs might have some problems. Singh and Kathuria (2016) conclude that “the first and foremost goal of involvement of the private sector should be to achieve efficiency gains as compared to purely procurement”. The PPP framework should be rebuilt to promote PPP projects. PPP is a good strategy to construct, operate, and maintain infrastructure facilities efficiently. However, the purpose of private companies is profit maximization. It is not always consistent with the optimization at the national level due to the fallacy of composition. Airport and port projects can attract private investment easily because investors can expect stable international standard income from foreign customers. The private sector might actively invest in infrastructure development in urban areas because it can expect enough income from users to recover the investment. On the other hand, the private sector might hesitate to invest in a sector where it cannot expect enough profits. The private sector can compensate the public sector but it cannot substitute for it. In order to develop infrastructure, the government must take the initiative in both investment and planning. This does not conflict with PPP, but might encourage it. Although huge fiscal deficits have constrained the increase of public investment in infrastructure, investment from the private sector will not be induced without it. The Golden Quadrilateral connecting the four major cities of Delhi, Mumbai, Chennai and Kolkata, and the North-South and East-West corridors have almost been completed. Their costs were funded largely by the government's special petroleum product tax revenues and government borrowing. The project tried to upgrade, rehabilitate and widen major highways. In 2015–2016 the government proposed a hybrid annuity model, which provided fiscal support from the government and took away the traffic risk from the investor. Consequently, the government received more bids in 2015–2016 (Live Mint 2015). Without government support and initiative, the private sector which has accumulated debt will not invest in infrastructure even if they get finance. Second, a master plan for infrastructure should be produced to make efficient logistics from the viewpoint of the national economy and to express sector-wise and area-wise priorities. Scarce government resources should be allocated according to the plan. Priorities expressed by the government may give a good signal to the private sector and encourage investment in the high priority projects. High priority should be given to projects which might reduce logistics costs effectively.

Literature presents contradictory views regarding the impact of public and private investment on the economic growth of a country. India being a developing country, where the major share of investment is by public sector, the question which props up is what among public and private investment is contributing more towards the economic growth of the country. In this framework, the gross domestic product (GDP) can be fairly explained as a function of public infrastructure investment and private infrastructure investment. Johansen’s co-integration was used to test the long-run relationship between the variables over the period from 1961–1962 to 2016–2017. A vector error correction model (VECM) along with an impulse response function and variance decomposition analysis was done to measure the impact of public infrastructure investment and private infrastructure investment on the GDP. Based on the empirical evidence discussed earlier, it was evident that both public and private infrastructure investments have a significant impact on the economic growth of the nation. Findings which came up in this study correlate to majority findings of past literature that, when compared with public investment, it is private investment which is capable of giving a better impetus to economic growth.

The agriculture sector which employs more than 55% of the country workforce whereas share of agriculture and allied sector to total GDP is 14.1% (2011-12). The farm sector achieved 3.6% growth during the 11 Five Year Plan (2007-12), falling short of the 4% growth target, although it was much higher than growth of 2.5 and 2.4% during 9 and 10 plan respectively. Thus, the sector needs urgent reforms to boost crop yields and private investment in infrastructure so as to motivate farmers and feed the growing population. At the latest Economic Survey (2012-13) points out that “India is at a juncture where further reforms are urgently required to achieve greater efficiency and productivity in agriculture for sustaining growth. There is a need to have stable and consistent policies where markets play a deserving role and private investment in infrastructure is stepped up. An efficient supply chaim that firmly establishes the linkage between retail demand and the farmer will be important”

In Latin America, the investment in infrastructure has been led by governments. However, the importance of PPP is growing, as fiscal revenues are decreasing in many countries due to the fall of commodity prices. Private investment in infrastructure in Latin America is outpacing other emerging economies. Latin America accounts for about 43% of the total private investment in infrastructure among developing economies. PPP is especially active in Brazil, Colombia, Chile and Peru. Among foreign firms, Spanish companies have the strongest presence in the PPP market of Latin America. Yet the competitive landscape is changing; while Spanish and European firms are losing their market share, Chinese and American enterprises are broadening their presence. Traditionally, investment in infrastructure has been concentrated in the ICT and electricity sectors but investment is being diversified into other sectors such as airports, railway, road, water and sanitation. Latin America has a less favorable PPP environment compared to other regions such as Asia. However, Chile, Brazil, Peru, Mexico and Colombia show promising conditions for PPP and hold a high rank among all developing countries. This is because these five countries have clear laws and institutions regarding PPP, and abundant experience with PPP projects. This study focuses on Chile, Peru, Mexico and Colombia and finds some similarities among these nations: 1) they have exclusive organizations for PPP, 2) projects with private initiatives are encouraged, 3) risks are transferred more to private sectors and subsidies from government are decreasing, 4) and there are growing projects in social infrastructure. We select some subsectors of infrastructure which have high demand for PPP projects. We also study several cases of foreign investment in each subsector: electricity in Mexico, transportation in Peru, health and medical treatment in Chile, and water and sanitation in Colombia. Latin America has several regional MDBs, such as the InterAmerican Development Bank (IDB) and Development Bank of Latin America (CAF). These banks play a crucial role for PPP projects. We offer four suggestions for firms: 1) firms need to understand the change in the infrastructure market toward more projects being planned in a PPP scheme rather than solely financed by the government, 2) the development level of the PPP environment differs by country, and thus firms need to prepare a customized strategy by country, 3) strategic alliance with local or foreign companies is crucial since they understand the local market well, 4) collaboration with regional MDBs, such as the IDB, CAF and CABEI, is recommended. This study also suggests the following policy recommendations for the Korean government: 1) The government can establish a government-business council and support Korean firms to win PPP contracts; 2) Incentives need to be provided to promote joint overseas business between conglomerate and small and medium-sized firms (SMEs); 3) ODA projects can be planned to identify infrastructure development demand in Latin America, and then the projects can be developed into PPP projects later, or feasibility studies for privately initiated PPP projects can be financed by ODA funds; 4) A formal cooperation system can be built between the Korean government and MDBs to facilitate Korean firms' access to MDBs; 5) Exchange of personnel from PPP-related institutions from Korea and Latin America can support Korean firms to acquire information and win projects.

Infrastructure development creates enough economic activities and development that have direct impact on socio economic development and overall national development. However, the role of traditional procurement / government spending on this sector has been under tremendous stress due to limited availability of resources. Public and private model and 100% private investments have been in vogue since couple of decades. The empirical government data projects a negligible or poor contribution of private sector, for various reasons though. The infrastructure gaps are still large and bridging those gaps will require tackling several problems, in terms of additional. This paper evaluates the current investment scenario and provide for radical changes in thought process and approach towards improving private participation in nation infrastructure building. One such approach is creating a national stock exchange for all private and public infrastructure investments and tagging this segment with organised industry profile. A CaaS (Construction As A Service) concept is being proposed to effectively utilise the limited resources and to avoid overlapping wasteful expenditures through pooling and shared services and on demand model. While it is not imperative to impress upon the establishment and public alike about the importance of private participation in infrastructure investments, it is order of the day to convince them about the real return on investments that they would commit. Similarly, bringing in public at large to participate in investing in infrastructure, a radical change will happen for good and the nation progress.

1 - Key Drivers of Food Insecurity

This article reviews the arguments for promoting private investment in infrastructure as a basis for poverty reduction in developing countries. It describes the experience leading to the development of international ‘facilities’ intended to address impediments to private investment. It then explores three ‘levels’ of literature: that of the facilities themselves, of donor organisations, and of academic authors. At each, it investigates the rationale and causal pathways leading from support for private investment to pro‐poor outcomes. It finds there is a possible but not necessary association between private investment, economic growth and poverty reduction, but the causal chain is poorly understood. It proposes the development of such a causal framework.

Private participation in public infrastructure is expected to bring operational efficiency gains and diversified access to large pools of financial capital. However, due to the heterogeneous and politically salient nature of infrastructure, the financial performance of infrastructure is often hindered by misaligned stakeholder interests and frequent governmental interventions. This study takes a new approach in examining the challenges of private investment in infrastructure by applying relational governance analysis to the infrastructure firm or asset. Although relational governance can encompass economic, legal, sociological and psychological governance perspectives, we borrow MacNeil (2000)’s two distinct definitions of “relational”; firstly, one that refers to the socio-political influences on the exchange and the other that refers to the continuing nature of contracts. These two aspects are correlated to each other in an inverse relationship; when socio-political understanding breaks down, the need of contract enforcement rises, and vice versa. This inverse relationship is illustrated in two contrasting airport infrastructure cases – British Airport Authority (BAA) and Auckland International Airport Ltd. (AIAL). For instance, the regulatory backlash that followed the acquisition of BAA reveals the need for socio-political understanding to manage interpersonal and inter-organizational dynamics among investors, management bodies, airport users, and the local community. In contrast, the AIAL case shows how the government can play – and did play – a central role in building strategic and national consensus, leading to favorable outcomes. This paper thus suggests that a deep understanding of socio-political interactions and wider political economic contexts can help overcome the shortfalls of the governance structure created by formal contracts.

The article substantiates the need to understand the essence of the green economy as an ecosystem in which the processes of economic, social, ecological, and political development are balanced. This is manifested in the implementation of important global events, political decisions at various levels, and the strengthening of analytical activities. The green economy includes three main concepts: low-carbon, resource-saving and socially inclusive development. In a green economy, employment and income growth is supported by public and private investment in infrastructure and assets that reduce carbon emissions and pollution, improve energy and resource efficiency, and prevent biodiversity loss. Various indices and indicators for measuring the development of the green economy are distributed in international analytics. The main indexes of measuring the greening of the economy include social parameters, social inclusiveness and greening. The Green Growth Index measures the performance of governments in achieving sustainable development goals (efficient use of resources, protection of natural resources, opportunities for implementing environmental initiatives, and social integration). The UNEP Green Economy Progress Index (GEP) does not remain unchanged and is constantly being improved and filled with new content to measure progress in achieving an inclusive green economy. The Green Economy Progress Index is a key tool for policymakers, analysts and other stakeholders in understanding the progress of the green economy.

In the context of growing demand for infrastructure investment in Asian countries including Bangladesh to support higher growth, this chapter discusses various alternative approaches of financing investments. This chapter particularly focuses on the use of spillover tax revenue to attract more private investments in infrastructure. Sharing spillover revenue with private investors will raise the rate of return of the private investors and improve infrastructures to a great extent with less burden on the government’s fiscal budget. Therefore, this approach is expected to create a win-win situation for both the government and private investors. Solving land acquisition related disputes is another key aspect for successful implementation of infrastructure investment projects. Therefore, we propose to use land trust method for acquisition rather than direct acquisition from landowners in order to reduce the cost and minimize the delay in implementation of infrastructure projects. Some innovative financing aspects practiced in Japan and other countries are also discussed.

Costa Rica's Payments for Environmental Services (PES) has been held as a promising option for valuing environmental services in developing countries. We undertook a systematic evaluation of academic and grey literatures and used narrative analysis and policy transfer evaluation to identify the global and local interactions that underpinned the successful implementation of PES. Our work shows that PES was an example of 'growing together' unique to Costa Rica and resulted from complex sharing of policy ideas, knowledge, and institutional and financial arrangements over time. We show that Costa Rica's PES represents a long–term developmental process rather than a simple and straightforward example of policy transfer. We conclude that the development and implementation of programmes valuing environmental services requires a set of underlying social, political, and economic conditions as well as evolving interactions between global and domestic policy arenas specific to each particular nation.

The study has estimated the extent of investment made in promotion of marketing infrastructure in the country and growth in public and private investments. It has also examined state-wise spread of private and public investments in agricultural marketing infrastructure, its composition and share and has investigated whether private investment induces pubic investment or vice versa. Of the total investment of Rs 157652.30 lakh made for the development of agricultural marketing infrastructure, Madhya Pradesh has accounted for the maximum (36%) share, followed by Tamil Nadu (18%) and Andhra Pradesh (13.5%). West Bengal has accounted for the lowest share. The analysis has indicated that there is a strong complementarity between private and public investments and as soon as private investment comes, public investment also starts pouring in. On investigating whether public investment is dependent on private investment or vice versa, the study has revealed that private investment induces public investment. The study has further indicated that in agricultural marketing infrastructure, private investment has taken a lead, which is a welcome change because private investment is more efficiently used as compared to public investment. To give further fillip to private investment in agricultural marketing infrastructure, the study has provided certain suggestions.