In a bid to make India’s vast infrastructure sector more attractive to foreign investors, a senior government official has suggested that India open only projects that have secured land acquisition and environment clearances for international bids.
“As the infrastructure sector opens up in India…. it is important that when many of these projects are structured, they are de-risked with all approvals, including land and environment, taken upfront and put in the SPV (special purpose vehicle) and then the SPV itself should be bid out, so that international companies can come in and play a major role and they don’t have to run around getting clearances,” said Amitabh Kant, chief executive officer of NITI Aayog.
Kant was addressing a seminar on Quality Infrastructure: Japanese Investment in India, organised by New Delhi-based think tank Centre for Policy Research and the Japanese embassy.
Instances of foreign infrastructure projects languishing for want of environmental clearances are common in India. Projects slowing down or coming to a halt due to the lack of land acquisition permissions are also common.
Land acquisition problems have dogged the Dedicated Freight Corridor (DFC) Project, under which freight railway lines will be constructed along the Western Corridor between Delhi and Mumbai and the Eastern Corridor between Ludhiana, Delhi and Son Nagar.
The DFC is an important part of the Delhi-Mumbai Industrial Corridor (DMIC) initiative, which is an India-Japan collaborative project for comprehensive infrastructure development to create India’s largest industrial belt zone, linking the industrial parks and harbours of the six states between Delhi and Mumbai in order to promote foreign export and direct investment.
Under the DMIC initiative, plans are also being implemented to create industrial parks and logistics bases with well-developed infrastructure up to 150km on either side of the Western Corridor.
Besides this, India is seeking investment in roads, ports, railways and other areas.
In his speech, Kant said Japanese companies in India should be provided with a conducive ecosystem to “enable them to create top class quality infrastructure in India because it will be very difficult for us to create good quality infrastructure of the next century”.
“India’s future for infrastructure lies with Japan and in many ways the future of Japan does not lie in Japan, it lies in India,” he said.
Kant also urged Japanese firms to be “cost-competitive” and take more risks in India.
“I would like to say that Japanese companies should take more risks and they need to become cost-competitive…by relocating their manufacturing bases to India,” he said.
Citing the example of Canada’s Bombardier, Kant said that the firm had created a manufacturing base in India and was producing Metro train coaches for the Indian as well as the Australian markets. Kevin Kiermaier Authentic JerseyShare This