Social and Impact
Spearheading the NIP: Capital inflows to boost social infrastructure sector
27 Jan 2022

National Infrastructure Pipeline (NIP) aims to kick-start  key greenfield and brownfield projects for investments across all economic and social infrastructure sectors. Projects have been systematically commissioned for their strategic use cases, requirements, and merits. Projects executed are being spearheaded with the support and participation of private sector enterprises who share financial risk, bring on board relevant experience and strengthen infrastructure quality, asset monetization, long term financing, thus forming a backbone to create a robust ecosystem across India.

It is imperative to talk about the progress of NIP. So far, 9,144 projects across 34 sub-sectors with US$ 1,488B costs are commissioned. Projects are executed across transport, power & energy, water sanitation, social infrastructure, communication, and commercial infrastructure.

The below table gives a snapshot of the scale of opportunities across sectors and sub-sectors.

As we see, the transport sector has the highest opportunities planned that is valued at approximately US$ 800B   including major projects like Delhi-Gurugram-SNB Regional Rapid Transit System accounting for US$ 4.8B followed by the energy sector with 687 opportunities, including projects like Solar Power Project valuing US$ 63.5B across the country. Undoubtedly, the sector is poised for growth and development. Significant investments are also pooled to create this robust infrastructure ecosystem for the country. This ensures the smooth movement of goods and services.

After the transport sector, most opportunities lie in social infrastructure, the second most important sector with more than 1,700   opportunities across India. Social Infrastructure includes education, affordable housing, health, and sports infrastructure as sub-sectors and has been a prime focus for 2020-25 FY, especially as the COVID-19 has been around since 2020.

As we see from the chart below, major investments opportunities were in West Bengal, Madhya Pradesh, Uttar Pradesh, Tamil Nadu, Andhra Pradesh, and Rajasthan.

As we analyze the need for opportunities and investments, education requires a key focus as a sub-sector. The education infrastructure sector   has 1,251 opportunities worth US$ 71.2B, with projects like Samagra Shiksha Development Project (US$ 3.17B) and Centre of Excellence Project [Solan] (US$ 8.4M). The results of these investments are yet to be assessed. However, there are clear investment opportunities to build the sector on a longer-term basis.


The Education Infra sector projects under social infrastructure are classified as below: 

Education Infrastructure sector

NIP Projects

Non-NIP projects

Stressed Assets

Number of projects

1,009

216

26

Project Cost (US$ Billion)

70

1

-

Source: indiainvestmentgrid.gov.in

Notes: IIG hosts investment opportunities in stressed assets to allow the purchase of viable stressed assets with a potential to turnaround

Similarly, in the affordable housing infrastructure sector,   234 opportunities worth US$ 166B have been identified, including projects like Pradhan Mantri Awaas Yojana Gramin worth US$ 59B and Credit Linked Subsidy Scheme Project in Maharashtra worth US$ 7.5B, which are expected to be completed by March 2022.

The affordable housing sector projects under social infrastructure are classified as below:

Affordable housing sector

NIP Projects

Non-NIP projects

Stressed Assets

Number of projects

157

76

1

Project Cost (Us$ Billion)

153

12

-

Source: indiainvestmentgrid.gov.in

The initiatives and projects under NIP can enable the monetization of operating public infrastructure assets as a key means for sustainable infrastructure financing under the National Monetisation Pipeline (NMP). Projects like Dholera Special Investment Region aiming to create infrastructure opportunities to set up manufacturing units will help increase the country's industrial output and create jobs for the gig economy, migrant workers  . There is an imperative need to introduce and amend National Labor code bills for the industry sector.

Schemes under NIP like Smart City Mission, AMRUT, National Solar Mission, Bharatmala, and so on act as a catalyst for boosting development, job opportunities, and FDI investment, thereby increasing the much-needed capital and talent pool in the country.

Adopting global standards backed with strong governance models in these projects helps boost the quality of delivery and transparency. Not only does it build confidence in the ease of doing business, but it also opens opportunities for business growth. These steps create interest among the global investment communities and partner nations and are well supported by them . India's goal of a US$ 5 trillion economy by 2025 is certainly ambitious. India is soaring high, backed by talent, market, capital, ecosystem, and open culture. India’s global competitiveness is increasing, and there is a significant rise in economic influence  . This can be seen through clearly, as India has the highest ever FDI inflow of US$ 67.9B  in 3 quarters of FY21. IMF also projected an 11.5 percent GDP growth rate for India in 2021.

The introduced PLI scheme is also a push to make India an emerging global production hub to become the world’s second most sought-after manufacturing destination by 2030). Schemes under India Investment Grid (IIG) will further need amendments through policy reforms to increase the investment opportunities and attract capital in these NIP initiatives through a public-private partnership. It is hopeful that budget FY 2022-23 judiciously paves the way for sustainable capital finance inflows in the country.

Authored by:

Lokesh Bohra, Senior Vice President, Social and Impact Advisory, Praxis Global Alliance

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