The importance of transparency in implementing large capital investment and development projects such as infrastructure is well recognized. The use of Public-Private Partnership (PPP) approach is increasingly prevalent in the infrastructure sector apart from the traditional Engineering Procurement and Construction (EPC) contract. Governments from more than 100 countries across the globe have enacted some form of transparency law in the recent past. Transparency law in India was enacted by the parliament in the form of the Right to Information (RTI) Act in the year 2005. The enactment of this law is seen as an essential milestone for ensuring transparency and accountability in governance. However, the empirical evidence of its impact is limited. This study analyses the effect of transparency law on both EPC and PPP procurement using data from 997 highway projects in India.

Three research objectives are investigated, namely (1) Effect of transparency on performance during the procurement and construction phase of PPP and EPC projects, (2) Effect of transparency on the development phase of PPP project, (3) Effect of transparency on the choice of procurement model of infrastructure projects. The main research findings are as follows: (1) There is a significant improvement in cost and schedule performance of infrastructure projects after the enactment of the transparency law. (2) It had a more profound impact on EPC procurement as compared to PPP. (3) It had a decreasing effect on the estimated cost and cost overrun of the EPC projects, whereas its impact on the cost of PPP projects was negligible. (4) Transparency had a significant decreasing effect on the time overrun of PPP projects.

Our finding that transparency law, a macro-economic level policy intervention, can impact the performance of infrastructure projects should be cheered. Cost and time overrun in infrastructure projects are a global phenomenon that has not changed for several decades. Our finding gives a new hope that project performance has improved in recent years because of transparency law. Enacting a strong transparency law can improve the cost performance of EPC projects and the schedule performance of PPP projects. Government should promote disclosure of project information at every stage of the project life cycle.