Cost of infra funding a challenge: Piyush Goyal

Finance Minister Piyush Goyal during a press conference ahead of the AIIB’s 2-day annual meeting, in Mumbai on Monday. (Express photo/Nirmal Harindran)

Finance Minister Piyush Goyal on Monday said infrastructure development will need investments of $4.5 trillion over the next decade and the cost of the money could be a challenge. Goyal, however, said finding the required finance will not be a “deterrence” for India.
“Infrastructure creation requires $4.5 trillion in investments over the next 10 years,” said Goyal at the Asian Infrastructure Investment Bank’s (AIIB) two-day annual summit that began in Mumbai.

The minister said the required funds will be available and raising it will not be a “deterrence” for infra creation. However, in the comments that come amid rising interest rates globally, led by hardening of rates in the US, as also domestically, Goyal flagged the cost of finance as an “important challenge”. Capacity building to handle big infra projects is also a challenge, Goyal said. He said that multilateral institutions like the AIIB will help in both the challenges. Underlining the need for a stable policy regime, Goyal said in the last few years, things have changed for the better with tweaks on governance practices and decisive actions.

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“Money is safe in India, because the rule of law prevails,” Goyal said. Goyal also said governments, both at the Centre and the states, have not defaulted on a single commitment on international borrowing ever.

Later at a press meet, Goyal said, India has proposed nine infra projects, including four in the private sector, to the AIIB for funding which will entail an investment of $2.4 billion. The overall funding for the four private sector projects will be $860 million, he added. At present, the AIIB has funded seven projects worth $1.4 billion since its formation in 2016, making the country as the biggest beneficiary.