Asia needs to tap huge savings to finance infra projects: ADB

Asia needs to tap huge savings to finance infra projects: ADB

Singapore: Asian countries should tap their multi-trillion dollar savings as well as mobilise private sector to meet the rising infrastructure funding needs, multilateral lending agency Asian Development Bank (ADB) has said.

Asia would need new infrastructure investment to the tune of $8 trillion through 2020 to support the current levels of economic growth, according to ADB projections.

“We must work diligently to be innovative, yet financially responsible, in mobilising Asian savings to deliver successful, sustainable and robust infrastructure projects," Asian Development Bank’s president Haruhiko Kuroda said on Sunday.

Going by the multilateral lender, gross domestic savings in emerging Asia stood at around $4 trillion in 2009.

“Much of this large cash pile has been under utilised, with regulatory obstacles, currency mismatches and underdeveloped capital markets hindering broader financing of essential infrastructure," ADB said in a statement.

India needs infrastructure investments of $1 trillion by 2015. The Manila-based lender noted that energy and electricity would account for about 40% of total infrastructure needs.

Speaking at an event in Japan, Kuroda said that infrastructure funds and local institutional investors, like pension and provident funds, can channel Asian savings to help finance public-private infrastructure projects.

The bank’s infrastructure-related investments is expected to cross $8 billion annually, over the next ten years.