Prime Minister Modi attends the ceremoney of the Third Annual Meeting of the Asian Infrastructure Investment Bank and express happiness for this opportunity to deepen the engagement with the bank and its members.
Modi says that AIIB started its financing operations in January 2016 and in less than three years, it has in its fold, 87 members and a committed capital stock of 100 billion US Dollars. It is composed to play a critical role in Asia.
The Asian Infrastructure Investment Bank is a result of collaborative efforts of Asian countries to provide a better tomorrow to our people. As developing countries, we share similar challenges. One of them is to find resources for provision of infrastructure. I am happy that the theme of this year’s Meeting is “Mobilizing Finance for Infrastructure: Innovation and Collaboration”. Investments by AIIB in sustainable infrastructure can impact the lives of billions of people.
Asia still faces wide ranging disparities in access to education, healthcare, financial services and formal employment opportunities.
Regional multi-lateralism through institutions such as AIIB can play a central role in helping to raise resources.
Sectors such as energy and power, transportation, telecom, rural infrastructure, agriculture development, water supply and sanitation, environment protection, urban development, and logistics require long term funds. The interest rates on these funds need to be affordable and sustainable.
In a short period, AIIB has approved 25 projects in a dozen countries with a total financing of over 4 billion US Dollars. This is a good beginning.
With committed capital of 100 billion dollars and huge need for infrastructure in member countries, I take this opportunity to call upon AIIB to expand from financing 4 billion dollars, to 40 billion dollars by 2020 and 100 billion dollars by 2025.
This would require simpler processing, and faster approval. It would also need high quality projects and robust project proposals.
PM says India and AIIB are both strongly committed to making economic growth more inclusive and sustainable. In India, we are applying novel Public Private Partnership models, Infrastructure Debt Funds, and Infrastructure Investment Trusts to fund infrastructure. India is trying to develop brownfield assets as a separate asset class for infrastructure investment. Such assets, having passed the stages of land acquisition and environment and forest clearances, are relatively de-risked. Hence, for such assets, institutional investment from pension, insurance and sovereign wealth funds are likely to be more forthcoming.
Another initiative, is the National Investment and Infrastructure Fund. This aims to channel investments from both domestic and international sources into infrastructure. This Fund has received a boost with AIIB committing 200 million US Dollars for investment.
India is one of the most investor-friendly economies in the world. Investors look for growth and macro-economic stability. They want political stability and a supportive regulatory framework to ensure protection of their investment. From the point of larger scale of operations and higher value addition, an investor is also attracted by a large domestic market size, availability of skilled labour and good physical infrastructure. On each of these parameters, India is well placed and has performed very well. Let me share with you, some of our experiences and achievements.
India has emerged as a bright spot in the global economy which is driving global growth as well. With a size of 2.8 trillion US Dollars, it is the seventh largest in the world. It is the third largest in terms of purchasing power parity. In the fourth quarter of 2017, we grew at 7.7 per cent. In 2018, we are projected to grow at 7.4 per cent.
Our macro-economic fundamentals are strong with stable prices, a robust external sector and a fiscal situation firmly in control. Despite rising oil prices, inflation is within the mandated range. The Government is firmly committed to the path of fiscal consolidation. Government debt as percentage of GDP is consistently declining. India has achieved a rating upgrade after a long wait.
The external sector remains robust. Our foreign exchange reserves of more than 400 billion US dollars provide us enough cushion. Global confidence in India’s economy is rising. Total FDI flows have increased steadily – more than 222 billion US dollars have been received in the last four years. As per UNCTAD’s World Investment Report, India continues to be one of the top FDI destinations in the world.
The Indian story of economic resurgence closely mirrors that of many other parts of Asia. Now, the continent finds itself at the centre of global economic activity. It has become the main growth engine of the world. In fact, we are now living through what many have termed the ‘Asian Century’.
A ‘New India’ is rising. It is an India that stands on the pillars of economic opportunity for all, knowledge economy, holistic development, and futuristic, resilient and digital infrastructure. We look forward to our continued engagement with our development partners including AIIB.
The interactions in this forum will be fruitful and enriching for all.
