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India will require nearly USD 4.5 trillion in infrastructure investments by 2030 to maintain its growth path, according to PFRDA chairman Sivasubramanian Ramann. Speaking at a NaBFID conference, he pointed to recent regulatory reforms and the need for pension funds, insurers and corporates to step in as long-term financiers. With RBI lowering provisioning norms on infra loans and a draft scheme on credit enhancement underway, the focus is now on widening funding sources beyond banks to meet the country's massive capital needs.
India will need nearly USD 4.5 trillion in infrastructure investment by 2030 to support its growth goals, said Sivasubramanian Ramann, chairman of the Pension Fund Regulatory and Development Authority (PFRDA), at a conference organised by the National Bank for Financing Infrastructure and Development (NaBFID). According to reports from NITI Aayog and the World Bank, this investment is needed to maintain momentum in urbanisation, transport, and energy development. Advertisement
Ramann explained that infrastructure spending delivers wider economic benefits, and to unlock this potential, capital markets must play a larger role. He highlighted the Reserve Bank of India's recent move to lower provisioning on infrastructure loans from 5% to 1%, calling it an important step in easing funding pressures on lenders.
He said financing responsibilities are slowly shifting from banks to pension funds and insurance companies, which are better suited for projects with long gestation periods. He added that credit flow to delayed projects could improve from October 2025, once regulatory changes are in force.
Challenges remain in the sector, including high leverage, weaker credit profiles and long project cycles that discourage companies from raising funds through bonds. Ramann said bond issuances by infrastructure firms are still small, with borrowers largely relying on long-tenure loans instead.
To widen financing options, PFRDA has floated a draft credit enhancement scheme linked to securitisation of infrastructure loans. Ramann said this could attract a broader pool of investors, including insurers and corporates, alongside banks and traditional lenders.
India's infrastructure pipeline has been one of the largest globally. In the Union Budget for FY26, the government allocated INR 11.21 lakh crore for infrastructure, following consistent double-digit growth in public capital expenditure in the past three years. Flagship programmes such as Bharatmala for highways, Sagarmala for port development, Gati Shakti for multi-modal connectivity and dedicated freight corridors for rail have created sustained demand for long-term funding. By comparison, China invested more than USD 6 trillion in infrastructure during the last decade, underlining the scale India is now aiming to match.
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