India's Infrastructure Dilemma

Though public infrastructure spending in India remains inadequate, Bloomberg's Andy Mukherjee reports that many of India's billionaires are now helping to plug the gap: How India's Rich Are Plugging Power, Road Gaps

It's easy, perhaps too easy, to become pessimistic about India's deficient infrastructure. Everything from potholed roads and clogged airports to frequent power blackouts and creaking urban transportation would appear to be daunting, if not intractable, shortcomings.
Sure, the challenges are humongous, and the pace of their resolution is slow. The highly indebted Indian government hasn't the wherewithal to make a decisive improvement, which is estimated to require additional spending equal to 3.4 percent of gross domestic product. That's almost three-quarters of what India is spending on transportation, power, water, irrigation, communications and storage capacity in a year.

The case for glumness is probably overstated.

Private enterprise is playing an increasingly important role. Inadequate public spending is still a huge constraint, yet domestic non-state companies are slowly taking the lead in allocating much-needed capital to some of India's most overlooked requirements.
A glance at the latest Forbes magazine list of 40 richest Indians should prove that point. Except for the ``knowledge- economy'' czars -- the computer-software and generic-drug exporters who are mostly sticking to what they know -- almost everyone else on that list is investing in infrastructure.