Sale of development rights to fund public transportation projects: Insights from Rajkot, India, BRTS project

This paper analyzes the sale of development rights to fund Bus Rapid Transit (BRT) project in Rajkot, India; highlights the key success factors; suggests reforms that would increase the tools' effectiveness; and identifies the lessons learned from Rajkot's experience. Specific lessons include the following: the sale of development rights must be calibrated to the existing or planned capacity of infrastructure and services; the majority of revenues from such a sale are likely to accrue after the infrastructure project has been developed, while funds are needed beforehand to develop the project, therefore, this revenue-expenditure mismatch needs to be addressed; and the development rights' sale price must be indexed to inflation.