In respect of international business, a project is called a turnkey project because :
The licensor starts the operation and hands over the key of the operating plant to the licensee.
A turnkey project is a mode of entry into international business in which a firm (the contractor or licensor) agrees to design, build and commission an entire facility, such as a plant, for a foreign client.
The contractor completes construction, installs machinery, trains staff and gets the plant running. Only when the facility is fully operational is it handed over to the client (licensee), who then merely has to 'turn the key' to start using it, hence the name.
In a turnkey project the client does not build the plant itself; the contractor does not hand it over half-finished for the client to complete; and it is not a joint venture with equal profit-sharing, since the contractor is paid for the completed project.
So a project is called turnkey because the licensor starts the operation and hands the key of the running plant to the licensee.
Hence, the answer is The licensor starts the operation and hands over the key of the operating plant to the licensee..
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