Infrastructure Project Financing with Government Funding
The procedure of infrastructure project is not always completed by the government. The government only provides two important aspects on this project. Other than the detailed information related to how the project should be completed, the government also provides the financial funding for the project. The detailed information is commonly including the instruction of the project. Meanwhile, the financial project will be compelled on specific infrastructure project financing. The infrastructure project itself is often offered to the private company to complete. During this offer, several private companies might be interested on handling the project. The government will select one of them based on their qualification.
After a series of discussion with the private company is performed, the government will give the infrastructure project financing. This financial data consist of the budget provided by the government in order to complete the infrastructure project. The government will give sufficient funding according to this budget allocation. In most case, the private project is able to meet the requirement to initiate the project. In order to attract government attention, some private companies even counter proposal the financial calculation with better offer. They are either able to complete the project before the target or complete it with less budget.
As you can see, the infrastructure project brings benefits to both sides. The government will get benefit upon the completion of the project. Since some companies give better offer to counter proposal the infrastructure project financing, the benefit can be more than that. In other hand, the private company handling the project will also gain benefit as well. They get income from the budget provided by the government. The government funding is more reliable than funding for project that comes from other company. Therefore, it should not be surprising if the government often working together with private business in order to complete the infrastructure project.
PT Sarana Multi Infrastruktur - Indonesia Renewable Energy