Experts in the infrastructure sector say Prime Minister Narendra Modi's announcement to set up Rs 100 lakh-crore modern infrastructure will help boost economic growth, create jobs and help India achieve $5 trillion economy goal. However, they argue that government intervention is necessary to remove major roadblocks in infrastructure development, including contract enforcement, speedy dispute resolution and regulatory uncertainty.
PwC Partner Manish Agarwal said achieving this level of infrastructure investment will need bringing back private capital in a big way. ''Large infra funds are keen to invest in brownfield expansions, but remain concerned about contract enforcement and speedy dispute resolution,'' he viewed.
Deloitte India Partner Arindam Guha observed that it would be critical for the government to attract private investment to achieve the goal of setting up Rs 100 lakh-crore modern infrastructure in the country. ''However, operationalisation of the credit enhancement guarantee corporation announced in the budget; strengthening regulatory framework in certain sectors like water to enable cross subsidisation through a tariff structure based on cost of service delivery and setting up more sector-specific financing platforms like National Investment and Infrastructure Fund-Roadis involving sovereign wealth funds, private equity funds are necessary,'' he noted.
Need Of The Hour
|Modi’s move comes at a time when the RBI has scaled down the growth forecast for 2019-2020 from 7% to 6.9% |
|Also, there is cut in projection for first half of the current fiscal from 6.4-6.7% to 5.8-6.6% |
On the other hand, Confederation of Indian Industry director general Chandrajit Banerjee said PM's encouraging words on the contributions of wealth generators are also being translated into action through missions on ease of doing business and Rs 100 lakh crore infrastructure construction. "These will go a long way to reassure entrepreneurs about the investment climate,'' he opined.