Infrastructure projects require long tenure financing that can only be provided by debt funds. For long, the biggest problem with private sector participation in infrastructure projects in India has been the lack of suitable debt capital. Our bond markets were insignificant and clearly not deep enough to attract patient capital, such as from pension and insurance funds. While asset-liability mismatch held back the banks from going far into infrastructure lending, the huge NPAs of public sector banks (the closest equivalent to development financial institutions), caused a virtual dry down in private sector funding. As a consequence, in the last five years the government has hardly launched any PPP projects. Almost all the infrastructure projects today are essentially government funded – under schemes like EPC or HAM. While this has helped the speed of execution, it is not sustainable in the long run.
At present, India has a BBB- rating from S&P Global Ratings for India’s creditworthiness, which is neither too good nor discouraging. However, the recently announced inclusion of India’s sovereign bonds into the important JP Morgan’s Government Bond IndexEmerging Markets (GBI-EM) index is a significant positive recognition of India’s economic credibility and thereby good news for its overall sovereign rating. It could also be the beginning of a new renaissance in private sector investment in infrastructure. It will also assist the government in its various fiscal measures to influence the economy.
Denne historien er fra 21 October 2023-utgaven av BW Businessworld.
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Denne historien er fra 21 October 2023-utgaven av BW Businessworld.
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'Committed to helping India achieve carbon neutrality'
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"MACARONS FOR THE MASSES"
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WHEN EVALUATING startup profitability, it’s crucial to break it down into two main components: unit economics and fixed costs. Unit economics refers to the profitability of delivering each singular order, which involves analysing transaction margins against costs incurred, such as delivery and payment gateway fees. This assessment helps gauge whether a business model is sustainable at a micro level.
THE HOLY GRAIL OF PROFITABILITY
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"WE ARE FOCUSED ON BUILDING A RESILIENT AND SELF-SUSTAINING SEMICONDUCTOR ECOSYSTEM"
S.KRISHNAN, Secretary of the Ministry of Electronics and Information Technology, outlines India's ambitious plan to build a resilient and globally competitive semiconductor industry through the India Semiconductor Mission
Shaping the Future of Cyber Risk Management
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THE PILLAR OF A RESILIENT DIGITAL FUTURE
The rapid evolution of digital technologies has transformed the world, driving unprecedented connectivity and innovation. Yet, as the digital realm expands, so do vulnerabilities, with cyber threats emerging as critical challenges for businesses, governments and individuals
