Minister for Road Transport and Highways Kamal Nath has hit the road looking for foreign investment in India’s highways.
He in the United States for a week, capping off a world tour to revive foreign interest in India’s roads and highways and says India is set to launch the world’s biggest Public Private Partnership program. One that will result in the development of 15,000 km of roads and highways over the next three years.
“Roads in India are not merely a matter of connectivity but are a very important component of inclusive growth and the outlays of roads by the government are a very important domestic stimulus, says Kamal Nath.
The minister has plans to increase the pace of road building, up from 2 km a day to 20 km a day. The Ministry is scouting for investment of $70 billion for road construction. Of this $45 billion is expected to come from the private sector, including $10 billion from foreign investors.
India’s road network of 3.2 million km is second only to the US and is in need of a major upgrade. This is why the minister for road transport and highways has been circling the globe looking for investors.
“India remains a very important investment destination and with some of the shocks that have happened here in the US India is a much better parking lot for investments. When there is a recession here people are skeptical of growth here but they are not skeptical of growth in India”, Kamal Nath said.
Investors worry about issues like the model concession agreement (MCA), including the termination clause, exit clause, conflict of interest and definition of associate’s clauses. Minister Nath says many of these issues would be ironed-out by the end of the month.
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