Public Capex, Blended Financing Fuel Huge Transformation In India's Infra Sector: Report

(MENAFN- IANS) New Delhi, March 25 (IANS) A huge increase in public capital expenditure and a maturing financing ecosystem have fuelled India’s infrastructure transformation, with government investment rising from Rs 2 lakh crore in FY15 to a budgeted Rs 12.2 lakh crore for FY27, a new report has said.

The report from India Narrative said the six-fold surge in public spending has catalysed private investment and stimulated demand for core industries such as steel and cement.

Further, it generated employment, the report said, also lauding a shift to a blended ecosystem that combines public funds, institutional capital, and market-based instruments. Such a shift has positioned India as the largest recipient of private participation in infrastructure in South Asia, accounting for over 90 per cent of regional investment flows, it said.

“In a global context where growth uncertainties persist, India’s commitment to infrastructure-led expansion offers a stable and scalable growth model,” the report said.

Further, the report noted that institutional platforms have been central to this shift as the National Investment and Infrastructure Fund, with approximately $4.9 billion in assets under management, has attracted sovereign wealth funds, pension funds and multilateral institutions.

NIIF’s partnerships with entities like ADIA, Temasek, and CPPIB signal a deeper integration of India into global capital flows, it said.

Meanwhile, the National Bank for Financing Infrastructure and Development is addressing one of the most critical gaps in infrastructure financing namely, long-term, patient capital. by sanctioning around Rs 3.03 lakh crore and disbursing over Rs 1 lakh crore.

The report also credited Infrastructure Investment Trusts and Real Estate Investment Trusts for mobilising over Rs 1.5 lakh crore through asset monetisation, allowing capital rotation into new projects.

REITs and InvITs have democratised infrastructure investment, enabling retail and institutional investors to participate in income-generating assets.

National Highways Infra Trust also emerged as a notable success mobilising over Rs 46,000 crore, proving the financial innovation as a critical adjunct to infrastructure expansion, the report noted.

-IANS

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