Rs 3,000 crore investment per day: That's how big India's infrastructure is going to get. India needs to spend at least Rs 50 lakh crore in next five years through the year 2022 to develop infrastructure, rating agency CRISIL has said.
Rs 3,000 crore investment per day: That’s how big India’s infrastructure is going to get. India needs to spend at least Rs 50 lakh crore in next five years through the year 2022 to develop infrastructure, rating agency CRISIL has said, adding that to achieve it, the country will see close to Rs 3,000 crore investment per day.
CRISIL, in its Infrastructure Yearbook 2017 report, said that the investment between 2018 and 2022 will be 56% more than the Rs 37 lakh crore projected spend between 2013 and 2017, and the major part of the investment is likely to come from private players.
CRISIL said that to ensure involvement of more private investments, comprehensive retooling of public-private partnership frameworks, and deepening of the infrastructure financing ecosystem are required. “For years now, the government has been doing the heavy lifting in terms of infrastructure investments. However, having only the public investment cylinder firing is not good enough,” CRISIL said. “Accelerating private sector investments is an essential complementarity, and the other cylinder that needs to fire,” it added.
To do that, CRISIL said that the country needs to solve, among other things, the problem of stressed assets in the banking system to push the investment cycle. “Spending of such magnitude requires expeditious resolution of the problem of stressed assets in banking, front-ending of bankable projects, comprehensive retooling of public-private partnership frameworks, and deepening of the infrastructure financing ecosystem, which is of tremendous importance,” CRISIL MD & CEO Ashu Suyash said in the statement.
The money will come from private players but where will it go? The power transmission sector in India is the most attractive area in the infrastructure sector to invest, according to CRISIL. Roads & highways and renewable energy follow next. “The power transmission sector in India is the most attractive to invest in currently, followed by roads & highways, and renewable energy,” CRISIL Infrastructure Advisory President Sameer Bhatia said. “Thermal generation, power distribution and railways need a lot of facilitation before they can draw big money. The urban sector, which is the least attractive right now, also needs a lot of attention,” Sameer Bhatia added.
Infrastructure Yearbook 2017 is the first report by CRISIL, which tracked, measured and assessed the development, maturity and investment attractiveness of infrastructure sectors.