(EMBARGOED) India needs $99 bn a year investment in infrastructure: UNSeptember 24th, 2008 - 10:09 pm ICT by IANS
New Delhi, Sep 24 (IANS) India will need an investment of $99 billion per annum for the next five years in six major infrastructure segments to support its planned annual economic growth of nine percent, according to the latest report of a UN agency.The World Investment Report (WIR) prepared by the United Nations Conference on Trade and Development (Unctad) released here Wednesday said that the public sector is expected to provide 70 percent of the investment, and the private sector the rest.
“The private sector is expected to take the lead in financing some infrastructure such as telecommunications, ports and airports,” the report said.
These plans could, however, face the same financing gaps as those of the preceding periods. For instance, over the period 2001-2010, the annual financing gap is estimated at $13.9 billion (Rs.554 billion), the report said.
The highest investment need is in the energy sector, which will require $30 billion (Rs.1.2 trillion) per year. Of this, the financing gap is estimated at $8.7 billion (Rs.348 billion).
Against this gap, the actual foreign direct investment (FDI) a year during the period April 2000 to February 2008 averaged only $200 million, the report said underlining the urgent need to work out private sector friendly policies that can attract FDI in energy as well as in the other five sectors.
The picture in the other five sectors is similar. The next highest investment need is in roads at $15.2 (Rs.608 billion) on average per year and the financing gap is $2.8 billion (Rs.112 billion). Actual FDI inflow was, however, on average only $400 million (Rs.1.6 billion) a year.
The telecommunications sector needs $13.0 billion (Rs.520 billion) investment a year, the financing gap is $1.2 billion (Rs.48 billion) and the actual FDI inflow was just $500 million (Rs.20 billion) on average per year.
Ports need $3.6 billion investment a year, the financing gap is $600 million and the actual FDI inflow was only $100 million.
Railways need $12.6 billion, the financing gap is $400 million and the actual FDI inflow was $100 million.
Airports require $1.6 billion a year, the financing gap is $200 million and the actual FDI inflow was nil, the report said.
While presenting the report here Wednesday, independent consultant and one of the Indian research contributors to the report Premila Nazareth Satyanand said: “The telecom sector has managed to attract the most FDI because policies are more private sector oriented and there is a lesson to be learnt there.”