Following President Donald Trump’s high-profile State visit, India and the US need to formally launch project Blue Dot, the multi-stakeholder initiative to set up high quality infrastructure pegged to global standards, which already has the support of Japan and Australia.
The Blue Dot Network (BDN), which came into being in November at the Indo-Pacific Business Forum in Bangkok, seeks to set up a globally recognised certification system for infrastructure projects to boost transparency and sustainability, and so is very much in our interest.
The BDN would reportedly bring together governments, the private sector and civil society to gainfully promote roads, ports, bridges et al, with a special emphasis on the Indo-Pacific region.
The certifying process would lay particular stress on viable funding arrangements, environmental soundness and high labour standards, so as to shore up quality infrastructural investments.
We, in India, probably have the highest number of infrastructure projects built in public-private partnership (PPP) mode in the last two decades.
And, yet, there is a huge and growing infrastructural deficit on the ground, and the vast bulk of projects that are essential requirement in, say, 2040 are not even on the drawing boards, leave alone being built. The way forward is to standardise big-ticket project implementation with transparent arm’s-length finance and to carry out effective project delivery. We need to modernise infrastructure finance.
Instead of reliance on opaque bank funding, we need to policy-induce an active and vibrant corporate bond market to rev up much-needed transparency in big-ticket projects. The way ahead is to set up special purpose vehicles to garner all and sundry clearances for specific investments, and then to invite bids for project implementation.
BDN projects would be able to raise debt, including from abroad, at fine rates. The bottom-line is that BDN has the potential to make a world of difference, compared to China’s wholly non-transparent, top-down Belt & Road Initiative with unsustainable levels of debt.