"We have been able to sustain growth in the face of global slowdown essentially on the strength of the infrastructure creation in India where the gap is huge," Jaitley, who is in China to attend the Board of Governors of the Asia Infrastructure Investment Bank, said.
"Over the next decade, we require over USD 1.5 trillion in India alone to fill up the infrastructure gap. We also use the additional resource which is available with us as a result of falling prices because that regime helps us," he said, adding that the government intends to connect seven hundred thousand villages with roads by 2019 as part of a massive modernisation plan.
"Infrastructure is where inequalities exist and the requirement of large number of economies world over is to fill up this infrastructure gap," he said.
Jaitley was addressing a seminar on "Infrastructure and Global Economic Growth" organised by China-sponsored AIIB along with finance ministers of many countries.
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"Over the next decade the world needs trillions of dollars to fill up this gap. I think it is extremely important if the world is to be pulled out from the present slowdown phase, infrastructure development holds the key," he said.
"In terms of highway construction this year alone our target is 10,000 kms. Our railway system is over 100 years old. We are going in for a massive modernisation," he said.
Jaitley said the government is seeking private sector participation in converting railway stations into commercial hubs.
The government plans to build more airports, sea ports and generate more power, particularly renewable energy which is ecologically also better from all points view, he said.
"These are all the emphasis areas we have undertaken," he said.
The government has set up India Infrastructure Investment
Fund where the government holds minority stake, Jaitley said.
"This a new experiment we have undertaken which we hope will be a success," Jaitley said, adding that the emphasis of India in the next decade will be to fill up the infrastructure gap which will also generate growth, employment and pull up number people out of poverty.
Projects succeed when risks for investment in projects are reduced and eliminated, Jaitley told the seminar.
He said "the risk element (for investments) has to be minimisedand virtually eliminated. It is only then the infrastructure creation can take place at a faster pace," he said.
"The projects have to be bankable, there has to be social acceptability of the fact that users must pay for infrastructure. Infrastructure does not come for free," he said.
"Those who use power must pay the actual tariff. Concessional tariffs do not work beyond a particular point," he said.
"They make infrastructure creation itself difficult. Therefore reduction and finally elimination of risk element will involve the social acceptability, where the society accepts the principle that the funding of infrastructure eventually has to come from users themselves. That is how the projects become bankable," he said.
"Otherwise the risk element will remain and projects will stop halfway, be incomplete," he said.
AIIB was officially established last year with an authorised capital of USD 100 billion in which India and 56 other countries joined as founding members. China is the largest shareholder with 26.06 per cent voting shares.
India is the second-largest shareholder with 7.5 per cent followed by Russia 5.93 per cent and Germany with 4.5 per cent.