Arani Town - Municipal

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Chapter - 11 Final Report: Arani Municipality Category Mitigate measures Ensuring service delivery . - 80 - Independent commissioning tester to ensure delivery of the required performance. O&M risk Increase in predicted operating costs Address future service delivery demands also Impact of design flaws & defective construction, deterioration of performance standards Technologically outmoded practices Inherent defects of the system Defaults from designer, builder and operators Funding uncertainties Cost escalation Delays in financial closure of the project General economic down turn Changes in Government policies, Shift in industry focus Operating guarantees/performance bonds to ensure service continuity and compensation for default Inbuilt options for upgrading technology as the contract term proceeds Escrow mechanisms to ensure protected cash flows and enforce during service/operational default Financial risks Termination rights in case of insufficient delivery/break down in service provision Ensuring project structure, in-built contractual provisions and foreseeing risks make the project bankable, addressing lender related issues. Mitigate risks arising from inflation, interest rates, foreign exchange rates etc. Avoid looking for the lowest cost bid- base selection upon financially sound structure and business plan Market risks Quantify demand, providing demand related information at the bid stage Initiate feasibility studies, demand forecasting, sensitivity analysis. Change in target-market competition Incentives to stimulate end-users Floods, Cyclones, Earth quakes, Tsunami Insurance coverage Interruption in Service delivery Project initiation Private operator Risks from Natural disasters Minimize impacts through appropriate insurances to transfer risk to insurer Regularly review insurance policies to ensure effective and adequate coverage Appropriate action plans for temporary service arrangements Risks in Private sector participation Specify desired project outcomes, taking into account Govt. policies Ensure sound financing pattern or the model on which the private sector has based its participation Voyants Solutions Private Limited
Chapter - 11 Final Report: Arani Municipality Category Mitigate measures Lack of service delivery Inadequate capabilities for legal and technical issues Delays due to statutory approvals Delays due to land acquisition Unforeseen risks to private operator Technically out dated mechanisms . - 81 - Ensure Government rights to take over some or all of the sub-contracts of the private party in case of its failure to perform. Contingency plans for continuation of core or ancillary services Ensure and technical legal ability to contract with private party Identify and facilitate Govt. approvals-related to planning, environment etc Anticipate ,identify and resolve land tenure issues- Acquisition , title, encroachments, usage of land Insurances to cover aspects like ownerís liability, asset risks, business interruption, some policy risks, natural disaster. Incentives to private sector to incorporate latest technology by making the design consultant, builder and the operator part of the OWG Voyants Solutions Private Limited
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SEPTEMBER 2009 S S T A G E ññ IV
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SWOT Analysis for Arani Municipalit
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The broad financial analysis of the
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Projects Identified for Implementat
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. - ii - Final Report: Arani Munici
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. - iv - Final Report: Arani Munici
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LLI ISSTT OFF FFI IGUURREESS . - vi
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. - viii - Final Report: Arani Muni
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Chapter ñ 1 Final Report: Arani Mu
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Chapter - 3 Final Report: Arani Mun
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Chapter - 14 Final Report: Arani Mu
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Annexure Final Report: Arani Munici
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Arani Town - Municipal

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