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New Focus on Indian Infrastructure: Forum Overview and Objectives

The Indian Government has given new priority to infrastructure development with Prime Minister Manmohan Singh taking personal charge through a Cabinet Committee. 

India plans to increase the gross capital formation in infrastructure from 5% of GDP to 9% by 2012, putting it on a par with the more advanced Asian economies. This means a target of $500 billion investment in infrastructure over the next five years, with $430 billion earmarked for the transport and utilities sector. This represents a huge business opportunity for contractors and designers, as well as financiers and investors.

Highlights of the proposed infrastructure programme include the $50 billion Delhi to Mumbai Industrial Corridor, high speed railway connecting major cities, a comprehensive road building programme  (90% of roads are currently not suitable for heavy duty trucks), as well as port upgrading and 500 operational airports within a decade.

McKinsey estimates that as a result of the financial crisis there is a deficit of between $150 billion and $190 billion in infrastructure funding in India. 25% of the infrastructure investment is expected to be funded through Public-Private-Partnerships (PPP).

Minister Kamal Nath, Union Minister for Road Transport and Highways, has called for a “complete change of mindset” focused on results and taking a fresh look at the regulatory framework for major infrastructure. Dr Montek Singh Ahluwalia, Deputy Chairman of the Planning Commission, has revealed the Government is     planning a further fiscal stimulus package worth up to Rs 20,000 Crore, which will help finance major infrastructure projects recently authorised by the Federal Government including 60 highway projects and critical port and power projects.

The Forum will address the creation of projects for tender by government agencies, the uptake of available projects by private sector developers and contractors, financial closure and completion of the projects. It will inform international infrastructure companies and investors about the new policies and the opportunities in India, as well as to provide a platform for dialogue on the basis for engagement with international partners.