GRI interviews infra investors: Saurabh Agarwal (CDPQ)

GRI Hub is interviewing a number of major investors about the current scenario and prospects for infrastructure investments in India. This will be one of the main topics under discussion at the Infra India GRI 2019, which will take place on January 29th and 30th in Delhi.

Saurabh Agarwal, Regional Director (South Asia) for Infrastructure Transactions at CDPQ, states that, "for CDPQ, India is among the five priority emerging markets". Here's what he says:

What is the investment potential in the infrastructure sector in India in the next 12-24 months?
We expect to see significant investment opportunities in the next couple of years in the
infrastructure sector, driven by a number of factors, including consolidation play in various sub-sectors as well as several government initiatives.

In your opinion, does the Indian infrastructure offer good opportunities in terms of risk-return?
India is one of CDPQ’s priority markets, which means we definitely see opportunities. Risk-return expectations of investors vary significantly; for us, as long-term investors, choosing the right strategy to invest and finding the right partners is key to find the right risk-return balance for the corresponding investment.

Which Indian infrastructure segments seem to be more attractive in the current
scheme of things?
We consider ourselves sector-agnostic and strategic, which means we invest time on an opportunity if it fits our strategy. However, we see strong potential in various sub-sectors in the Indian Infrastructure market including – renewables, roads, airports, railways, ports, water, etc.. These are essential public services and as India’s needs grow, each of these sectors will have tremendous opportunity to grow as well.

Do you see any kind of obstacles when it comes to global players investing in the
Indian infrastructure? How is it possible to face them?
It is not so much about obstacles; if anything, there are only specific challenges which investors ought to be able to understand and manage – it’s the same in every market; that’s where the experience and expertise of the teams supporting the global investors become critical. If you have good teams with ears to the ground and aligned local partners who have the right market knowledge and expertise, you can face all these challenges and seize the best opportunities.

What twould be the turning point for Indian Infrastructure investments after
the highs and lows the sector has faced?
India needs institutional class, long-term capital, high-quality management teams who are motivated to bring in quality, efficiency and scale into the operations of our infrastructure assets. The good news is that the journey has already begun.