Deals

Indian road minister hits the road to attract investors

Traveling this week to Zurich, Shri Kamal Nath continued to woo investors to the country’s road sector, where he plans to build ‘more roads than any other country’ in the next two years and sees an opportunity for $40bn of private investment.

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Shri Kamal Nath, India’s minister for road transport and highways, traveled to Zurich this week to inform European investors gathered at the Swiss city that India will build more roads than any other country in the next two years and asked them for their financial support in reaching this goal.

The Government of India’s Press Information Bureau (PIB) said in a statement describing the event that Nath met with a “strong gathering” of investors, developers and financial institutions and invited them to invest in India’s road and highway sector.

The Indian Government is committed to increase the pace of highway development to 20 kilometers per day – a rate that would “unleash huge business and investment opportunities amounting to $70 billion over the next three to four years”, Nath said, according to PIB. Of the total investment required, $40 billion is expected to come from the private sector, he said.

Responding to queries from investors at the gathering, Nath told investors the government is willing to review the model concession agreement used for road investment to make it more investor friendly, according to PIB's account of the meeting. The model contract’s clause for termination was highlighted as a major concern by the lending institutions gathered at the Zurich meeting, PIB said.

The gathering, “Building India: Road Infrastructure Summit”, was organised by the Confederation of Indian Industries, ICICI bank, JM Financial Consultants and the Swiss-Indian Chamber of Commerce. It was part of a larger “road show”, or a group of planned gatherings designed to woo investors, that is being attended by Nath as he drums-up interest in the roads sector.

Last month, at French business school INSEAD, he again highlighted the importance of private investment and added that “the least difficult should be financing because there is a model, there is a market”, according to a video of the event posted on the business school’s website. He also said: “the last decade was the decade of [information technology], of the knowledge economy. The next decade, the story of India has to be the story of infrastructure” – a sentiment he repeated at the Zurich gathering, according to PIB.

And at gathering in New Delhi last month, he said he would like to invite bids for 12,000 kilometers of road this year alone, a sum that could be worth INR1,000 billion (€1.4 billion; $2 billion), according to local TV coverage of the event.