Indian Cities Need To Invest $840 Billion In Infrastructure: World Bank Report As per the report, only 5 per cent of the infrastructure needs of Indian cities are currently being financed through private sources
By Teena Jose
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A new World Bank report, on Monday, said that India needs to invest $840 billion over the next 15 years, or on an average of $55 billion per annum, into the urban infrastructure from an average of $10.6 billion a year in the past decade to an average of $55 billion a year for the next 15 years.
The report, titled 'Financing India's Infrastructure Needs: Constraints to Commercial Financing and Prospects for Policy Action', estimated that India would need $840 billion over the next 15 years.
"By 2036, 600 million people will be living in urban cities in India, representing 40 per cent of the population. This is likely to put additional pressure on the already stretched urban infrastructure and services of Indian cities, with more demand for clean drinking water, reliable power supply, efficient and safe road transport amongst others," said the World Bank in a statement.
"Currently, the central and state governments finance over 75 per cent of city infrastructure, while urban local bodies (ULB) finance 15 per cent through their own surplus revenues," the statement added.
As per the report, only 5 per cent of the infrastructure needs of Indian cities are currently being financed through private sources. With the government's current (2018) annual urban infrastructure investments topping at $16 billion, much of the gap will require private financing.
"Cities in India need large amounts of financing to promote green, smart, inclusive, and sustainable urbanization. Creating a conducive environment for ULBs, especially large and creditworthy ones, to borrow more from private sources will therefore be critical to ensuring that cities are able to improve living standards of their growing populations in a sustainable manner," said Auguste Tano Kouamé, country director, World Bank, India, in a statement.
The report recommended expanding the capacities of city agencies to deliver infrastructure projects at scale. Currently, the 10 largest ULBs were able to spend only two-thirds of their total capital budget over three recent fiscal years.
