New Delhi: To bring back momentum in the Ganga clean-up process, the cabinet on Wednesday approved a hybrid annuity-based public-private partnership model under the Namami Gange programme for wastewater treatment, fast-tracking projects and ensuring effective utilization of funds.

“Marking a paradigm shift in implementation, a hybrid annuity-based public-private partnership model will now be adopted to ensure performance, efficiency, viability and sustainability. In this model, a part of the capital investment (up to 40%) will be paid by the government through construction-linked milestones and the balance through an annuity over the contract duration, up to 20 years," said a statement released by the government.

Under the model, special purpose vehicles (SPVs) will be created to carry out cleaning of sewage treatment plants along the river. Payment will be made on an annuity basis to ensure that projects are not abandoned mid-way.

Under the guidance of the National Mission for Clean Ganga, the SPVs will be established under the Companies Act 2013 for providing the required governance framework and enabling functional autonomy.

The move comes in the backdrop of the government failing to generate the kind of interest and support it expected for its flagship Namami Gange programme.

Under the new model, the central government has given more power and responsibility to states. More freedom will also be given to the SPVs to drive cleaning and maintenance work of sewage treatment plants—both existing and new.

“The SPV will enter into a tripartite memorandum of agreement (MoA) with participating state governments and concerned urban local bodies (ULBs) for taking up individual projects. These MoAs will aim to introduce reforms and regulatory measures for recovery of user charges on the polluter-pays principle, and put restrictions on usage of ground and fresh water for non-potable purposes through stricter monitoring and guidelines that promote reuse of treated wastewater," the statement added.

The move could help the National Democratic Alliance government circumvent the problem of not getting enough support from Ganga basin states where it is not in power. Starting from Gangotri in Uttarakhand, the river runs through Uttar Pradesh, Bihar, Jharkhand and West Bengal.

The government aims to float tenders for the plan by April. The private players selected will get payment through deferred annuity where money will be given on the basis of their work at the end of the year.

“This will help in taking up more projects with the same allocation as made available under the Namami Gange programme, with reduced financial liability in the initial years. Spreading the stakes of the private participant over the entire period of concession would ensure continued operations over the long term. Linking of performance standards with annuities will ensure the desired objective of treated water of an appropriate standard.

“It will help in gradual capacity-building of the ULBs by setting the stage for recovery of user charges on polluter pays principle," the statement said.

The government has allotted a budget of 20,000 crore to the Namami Gange mission, a pet project of Prime Minister Narendra Modi.

The Ganga has significant economic, environmental and cultural value. Its basin accounts for 26% of India’s landmass, 30% of its water resources and more than 40% of its population.