<p>Private participation in infrastructure development in India has decreased significantly, from $160 billion (46.4 per cent of total investments) between 2009-13 to $39.2 billion (7.2 per cent) between 2019-23, according to a report by real estate consultancy Knight Frank India on Thursday. </p><p>This shift has led to a larger share of government-led investments, widening the fiscal deficit of centre and states. The investment opportunity for private participation in infrastructure development in India ranges between $103.2 billion to $324 billion till 2030, the agency said in the report.</p> .<p>In one scenario, a 10 per cent top up in private investments in infrastructure to 14.7 per cent can bring the potential opportunity amount to $324 billion, an annual average of $54 billion until 2030. Similar large-scale investments are already being undertaken in peer economies.</p><p>Even as the central government spend on infrastructure has increased from 0.5% of the GDP in 2013 to 2.2 per cent of the GDP in 2023, on a global scale, it is relatively less in comparison to peer economies such as China (4.8 per cent between 2018-2023, 8-10 per cent before Covid-19) and Vietnam (6 per cent), Knight Frank said.</p> .<p>In another scenario, at an existing investment share composition of centre (51.2 per cent), state (44.1 per cent), private (4.7 per cent), the estimated gross fiscal deficit in 2030 will still be 4.7 per cent of GDP, which is above the government’s defined fiscal deficit threshold, it said.</p><p>Finance Minister Nirmala Sitharaman has promised to bring down the union government’s fiscal deficit - the difference between expenditure and revenue - to 4.5 per cent of GDP by financial year 2025-26.</p> .<p>The private participation in infrastructure development in India amounts to $103.2 billion until 2030 at current levels. However, the share of private investment in this composition is negligible and needs to expand.</p><p>Challenges such as project delays, financing challenges and limited funding mechanisms including inadequate foreign investment, risks associated with revenue generations, cost overruns due to delay in project approvals, deter private investment, it said.</p>
<p>Private participation in infrastructure development in India has decreased significantly, from $160 billion (46.4 per cent of total investments) between 2009-13 to $39.2 billion (7.2 per cent) between 2019-23, according to a report by real estate consultancy Knight Frank India on Thursday. </p><p>This shift has led to a larger share of government-led investments, widening the fiscal deficit of centre and states. The investment opportunity for private participation in infrastructure development in India ranges between $103.2 billion to $324 billion till 2030, the agency said in the report.</p> .<p>In one scenario, a 10 per cent top up in private investments in infrastructure to 14.7 per cent can bring the potential opportunity amount to $324 billion, an annual average of $54 billion until 2030. Similar large-scale investments are already being undertaken in peer economies.</p><p>Even as the central government spend on infrastructure has increased from 0.5% of the GDP in 2013 to 2.2 per cent of the GDP in 2023, on a global scale, it is relatively less in comparison to peer economies such as China (4.8 per cent between 2018-2023, 8-10 per cent before Covid-19) and Vietnam (6 per cent), Knight Frank said.</p> .<p>In another scenario, at an existing investment share composition of centre (51.2 per cent), state (44.1 per cent), private (4.7 per cent), the estimated gross fiscal deficit in 2030 will still be 4.7 per cent of GDP, which is above the government’s defined fiscal deficit threshold, it said.</p><p>Finance Minister Nirmala Sitharaman has promised to bring down the union government’s fiscal deficit - the difference between expenditure and revenue - to 4.5 per cent of GDP by financial year 2025-26.</p> .<p>The private participation in infrastructure development in India amounts to $103.2 billion until 2030 at current levels. However, the share of private investment in this composition is negligible and needs to expand.</p><p>Challenges such as project delays, financing challenges and limited funding mechanisms including inadequate foreign investment, risks associated with revenue generations, cost overruns due to delay in project approvals, deter private investment, it said.</p>