According to Ratan Lal Kashyap, Sr. Vice President - Procurement, G R Infraprojects, rising income levels and economic prosperity is likely to drive demand for infrastructure investment in India.
Do you see the pace of infrastructure development sustaining at the present levels?
The pace of infrastructure development is depending on stable government post this election. The current government has a great focus on infrastructure development for better economic growth. If the current government's plan for development continues, we would see the next level of infrastructure development in the country.
Has the country been able to effectively hard-sell the potential of the Indian infra growth story?
Over the next few years, rising income levels and economic prosperity is likely to drive demand for infrastructure investment in India. As the gap between required infrastructure investment and the current investment trend is expected to be widened, so investments from private institutions, dedicated for infrastructure financing has been encouraged which will reduce the existing gap.
Do you find the valuation of the ongoing and proposed infrastructure projects attractive for investors?
In totality, the valuation parameters are quite varied that include the cost of construction, quality of construction, operation maintenance, and designs which are considered for making a business decision. The recent policy of the Ministry of Roads, Transport and Highways (MoRTH) for extending the defect liability period for 10 years would entail maintaining the road for the same period which will require better design and construction.
Which initiatives do you perceive as driving the sector's growth in 2019-20 fiscal?
The present government's assurance of fund and availability of land; proactive decision making in forest clearances; environmental clearances; utility shifting; removal of encroachment etc, has been appreciated from all the quarters for on-time completion of projects. We foresee the infrastructure to grow further as the momentum has been attained.
The refined HAM has comparatively worked well. The funding dynamics might change based on banking sector policies and other parameters involved.
Has the country also been able to curtail cost and time overruns?
Government acceptance of new technology and international benchmarks of new construction methodologies has helped in faster construction and on time delivery of projects.
What are some of the challenges that cannot be left hanging fire any longer?
Issues around infrastructure growth in India bring some core themes that cannot be left hanging. The structure of infrastructure companies, cost over-runs, and the need to recycle assets to real-money balance sheets should be addressed on priority so as to support the infrastructure growth in India. A better level of corporate governance is essential for infrastructure businesses, given the scale of investments, the lack of alternative uses of assets once created, and the urgent need to develop such assets. Whether publicly listed or not, overall corporate governance standards need to improve to create a more robust ecosystem. Both public, as well as, private funding is required in respect to infrastructure creation and funding management.