The infrastructure spending in the country is required to be enhanced to Rs 50 lakh crore over the next five years and power, transport and urban sectors are expected to corner over three-fourths of such investments, according to a Crisil report as per the PTI.
It further said that infrastructure investment in India is estimated to have risen to Rs 37 lakh crore, or 5.6 per cent of GDP, between fiscals 2013 and 2017, marking a 56 per cent growth over the Rs 24 lakh crore spent in the preceding five years.
"Crisil believes spending on infrastructure needs to increase to Rs 50 lakh crore over the next five fiscals through 2022.
"This projection factors an average annual GDP growth of 7 per cent, infrastructure investments equal to 5.5 per cent of GDP, and a pick-up in private sector investments after fiscal 2019," Crisil Infrastructure Yearbook 2017 said.
It further predicted that power, transport and urban sectors will account for 78 per cent of the overall infrastructure spending.
The report pointed out that in fiscals 2016 and 2017, higher central government spending partially offset a steep decline in private investments and deterioration in state government finances.
It said weak project preparation, poorly structured contracts with inappropriate risk allocation, irrational bidding exuberance, and over-reliance on bank-led financing in the past have spawned the 'twin balance-sheet problem' of deeply indebted developers and gargantuan stressed assets in banking.
"The takeover of distribution utility losses under the Ujwal Discom Assurance Yojana, or UDAY, and the recent agri- loan waivers have further strained state finances," the report added.