Why does India need the National Infrastructure Pipeline?

Rakesh Singh, HDFC Bank, explains his perspective of NIP and why it’s exactly what India needs
3 MIN READJanuary 29, 2020
The National Infrastructure Pipeline (NIP), was implemented recently by the Indian Government as a response to the projected $4.5 trillion that needs to be spent on infrastructure to sustain its growth rate.

The challenges facing the sector have predominantly been on the structuring side. The government has been paying a serious amount of money for acquisitions and land. When they do this, the viability of the product comes into question. There was only so much longer they could have continued to roll out expensive projects. The aim of NIP is to allow for more infra projects, while also growing business and creating jobs, as well as providing equitable access for all. But is it suitable for the situation?

Rakesh Singh, Group Head - Investment Banking, Private Banking, Capital Markets and Financial Institutions, HDFC Bank, said to the GRI Hub in an interview: “It’s definitely the right thing to do, as the country needs massive investment in infrastructure. Transport most importantly, which is why roads are probably the biggest commitment from this government, but right now we’re in dire need of investment all across the infrastructure asset classes.”

“If you look at our cities; they are very densely populated and the need for mobility is high, yet our metro’s haven’t been properly scaled up or maintained to meet the demand. [Mumbai] has twice the population of Tokyo or London, yet our public transport is not yet anywhere near the same level. So there is definitely a need for something like the NIP.” 

“Similar to that, there are other integral issues like the cost of mobility. With the rising costs of petrol and diesel, people are gradually emigrating to electric vehicles or shared mobility as a way to mitigate cost. When it comes to distribution of cooking gas in residential zones we need massive city gas pipelines in all our cities and towns. We need investment for proper, up to date, distribution networks - especially as the world works towards establishing and meeting certain climate change goals. Water, its storage and desalination, is going to be a large investment. The distribution of water across India, especially where the availability of drinking water is slim, will be of the highest importance.”

For more information on the Indian infrastructure sector, join many of the most senior individuals present in the industry at Infra India GRI, taking place in New Delhi on 19 - 20 February, 2020.

Article by Matt Harris

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