Infrastructures

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India’s Infrastructure Growth: Boosting Private Investments and Strengthening PPPs

India has made remarkable progress in attracting private investment in the infrastructure sector. Between 2002 and 2012, the private sector contributed approximately US$ 250 billion to various infrastructure projects. More notably, infrastructure investment as a share of GDP rose from 4.9% in 2002-03 to 7.2% in 2011-12 and was projected to reach 10% of GDP by 2016-17.

During the XII Plan period (2012-17), the Government anticipated that nearly half of the US$ 970 billion required for infrastructure development would come from private sources, including Foreign Direct Investment (FDI). Recognizing the need for substantial investments and improved infrastructure

services, India adopted a Public-Private Partnership (PPP)-centric approach as a key policy framework.

Government Initiatives to Attract Private Investment

To encourage private sector participation, the Government of India has implemented several progressive policies, including:

➤ 100% FDI in most infrastructure sectors, with no restrictions on profit repatriation.
➤ Viability Gap Funding (VGF) Scheme, designed to improve the financial viability of competitively bid infrastructure projects.
➤ A strong focus on PPP models, ensuring private investment plays a crucial role in infrastructure expansion.

ITA’s Role in Infrastructure Development

The Confederation of Indian Industry (ITA) is actively engaged in strengthening India’s infrastructure ecosystem through its National Committee on Infrastructure and Sectoral Committees. These committees drive policy interventions and industry recommendations across key sectors, including:

➤ Roads & Highways

➤ Airports & Aviation

➤ Railways

➤ Ports & Shipping

➤ Urban Infrastructure & Housing

Through its Infrastructure Division, ITA collaborates with central and state governments, industry leaders, and stakeholders to promote PPP as the cornerstone of India’s infrastructure development. By advocating for progressive policies and enabling industry participation, ITA continues to support the creation of world-class infrastructure that fosters economic growth and global competitiveness.