India Requires $2.2 Trillion Infrastructure Investment To Reach $7 Trillion Economy By 2030: Report

India will need an estimated investment of $2.2 trillion in infrastructure to achieve its target of becoming a $7 trillion economy by 2030, according to a report by real estate consultancy Knight Frank India.

The report, titled India Infrastructure: Reviving Private Investments, highlighted the crucial role of infrastructure development in supporting India’s economic growth trajectory.

The report projects that to reach a $7 trillion GDP by 2030, India's economy must grow at a compound annual growth rate (CAGR) of 10.1 per cent between 2024 and 2030.

It emphasised the need for radical reforms to boost private sector participation in infrastructure development, addressing the heavy reliance on government-led investments, which risks straining fiscal deficit targets.

Shishir Baijal, Chairman and Managing Director of Knight Frank India, noted, “Strong impetus on infrastructural development and increased budgetary allocation by the government has led to India's ranking in the Logistics Performance Index (LPI) improve from 54 in 2014 to 38 in 2023.”

He credited policymakers for their aggressive push to expand India’s infrastructure, which has created significant opportunities for private investors.

However, private investment in infrastructure has declined sharply, falling from $160 billion (46.4 per cent of total investments) between 2009–2013 to $39.2 billion (7.2 per cent) between 2019–2023.

Baijal stressed, “Radical measures are required to induce a higher allocation of private investments towards infrastructure development to balance fiscal prudence to the government's budget and bring inclusive and long-term sustainable economic growth in the country.”

The report cautioned that the central and state governments’ heavy dependence on infrastructure investments could widen fiscal deficits.

The central government aims to reduce its gross fiscal deficit to below 4.5 per cent by 2025.

Increasing private sector involvement would help the government redirect funds to other critical areas such as public healthcare, human capital development, and debt payments, which are vital for sustainable long-term growth.

Sector-wise, the report identified renewable energy, data centers, roads and highways, and logistics as key areas for attracting private investments.

It also highlighted massive investment opportunities in urban mass transit, airports, and power distribution, driven by rapid urbanization and shifting demographics.

Knight Frank emphasised that balancing public and private investments in infrastructure is essential for India’s economic growth and long-term stability.

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