The Himachal Pradesh government is planning a major urban expansion initiative with the development of a satellite township at Jathia Devi, approximately 14 km from Shimla. The project is being considered under a Public-Private Partnership (PPP) model and aims to reduce congestion in the state capital by decentralizing administrative functions and housing development.

Purpose and Scope of the Project

The key objective of the proposed township is to decongest Shimla by relocating various government offices and creating planned housing societies in the new area. With Shimla facing increasing strain on infrastructure due to population growth, this project is expected to provide much-needed breathing space and enable better urban planning.

Land Acquisition and Development Area

The Himachal Pradesh Urban Development Authority (HIMUDA) has already acquired 35 hectares of land for the township’s initial development. Plans are also underway to acquire an additional 100 hectares to support further residential, commercial, and administrative infrastructure.

Official Planning Designation

On January 23, 2024, the Town and Country Planning Department officially notified Jathia Devi as a Planning Area. The designated area includes 177 villages from Shimla and Solan districts, which will be developed under a structured urban framework to ensure sustainable growth and regulation of construction activities.

Financial Constraints and Funding Strategy

The state government has submitted a proposal seeking ₹500 crore from the Union Ministry of Housing and Urban Affairs under the Urban Challenge Fund to support this ambitious project. However, the request has not yet received approval, posing challenges to the project’s financial viability. To overcome this hurdle, the state is actively exploring the PPP model as a viable alternative to attract private investment while ensuring public benefit.

Public-Private Partnership (PPP): An Overview

What is the PPP Model?

The Public-Private Partnership (PPP) is a collaborative arrangement between a government or statutory body and a private sector entity. This model involves investment and/or management by the private party for a defined period. The risks and responsibilities are shared, and the private partner is selected through competitive bidding. Payments are made based on the entity’s performance against pre-defined and measurable standards.

Models of Public-Private Partnerships in India

Several PPP models are commonly implemented, depending on the level of investment, risk sharing, and operational control:

Build-Operate-Transfer (BOT)

• Private partner designs, builds, and operates the facility during the concession period.
• After completion, ownership is transferred to the public sector.
• Used extensively in national highway projects by NHAI.

Build-Own-Operate (BOO)

• Private party retains permanent ownership.
• Government agrees to purchase goods/services produced.

Build-Own-Operate-Transfer (BOOT)

• Similar to BOT, but the asset is owned by the private sector during the concession and transferred later.
• Used in highways and ports development.

Build-Operate-Lease-Transfer (BOLT)

• Private entity builds and owns the facility, leases it to the government, and eventually transfers ownership.

Design-Build-Finance-Operate (DBFO)

• Private party handles design, construction, financing, and operations throughout the concession period.

Lease-Develop-Operate (LDO)

• Government retains ownership, while the private sector leases, develops, and operates the facility.
• Commonly used in airport development.

These models vary in terms of investment, ownership, technical collaboration, and revenue mechanisms.

Conclusion

The Jathia Devi satellite township represents Himachal Pradesh’s first such urban expansion project and marks a significant step toward modern, sustainable, and decongested urban development. While funding challenges persist, the adoption of the PPP model may pave the way for timely and efficient implementation, benefiting both residents and administrative functions in the long term.