Kamal Nath discusses India's infrastructure deficit

Kamal Nath made the first luncheon address at the 2010 Credit Suisse Asian Investment Conference to a packed room yesterday. India's cabinet minister for road transport and highways was in fine fettle as he regaled the audience with humorous anecdotes and personal reminiscences. His talk kept the audience engaged, but lacked specifics regarding his plans to meet his infrastructure development targets for India.

In his introduction of Nath, Credit Suisse's chief executive officer for Asia-Pacific, Kai Nargolwala, mentioned that the two are old friends and that Nath's current portfolio [infrastructure] "represents his biggest challenge yet". Nath elaborated on the theme of their association as well, saying in school Nargolwala was always the good student, while he was generally the laggard.

His new role sees Nath regularly attending conferences as he tries to persuade investors to buy into India's infrastructure plans, both literally and figuratively. "At the last three conferences I've attended the two buzzwords were bonuses and emerging markets," he said to a visibly amused audience. "However, the buzzword should be infrastructure." He went on to say that it is no surprise to him that the US stimulus package has an emphasis on infrastructure as this is the need of the hour.

"India is not only the world's largest democracy but also the world's rowdiest, so our solutions have to be India-specific," Nath said, defending the slow pace of change for which India is often criticised. Nath went on to highlight that India did not have a financial crisis. "We felt some stress as an inter-connected but not inter-dependent economy," he emphasised.

"Globally, governments are giving money to their banks to keep them afloat, but in India banks are giving money to the government," he said.

Nath's current preoccupation with improving India's road network was much in evidence as the next part of his speech was focused on roads. "Our 3.4 million kilometres of roads makes us the second largest in the world," said Nath adding that India's rural road connectivity programme has been a success and is something China is now embarking upon. Nath has an ambitious target to build 7000km of roads annually, which translates to 20km daily. To achieve this target India needs to have WIP [work-in-progress] of 20,000km of roads at an estimated outlay of $50 billion.