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Union Finance Minister Nirmala Sitharaman delivered the keynote at a seminar on the New Development Bank's role in mobilising private capital, held in Jaipur on 12 August 2026.
The seminar was on the sidelines of the BRICS Finance Ministers' and Central Bank Governors meeting in Jaipur.
Dilma Rousseff, President of the New Development Bank, delivered a special address.
The Minister set out India's infrastructure financing toolkit — Viability Gap Funding, the Hybrid Annuity Model, credit enhancement, InvITs, the National Infrastructure Pipeline and PM Gati Shakti.
She argued that public capital must act as a catalyst for private investment rather than a substitute for it.
A multilateral development bank founded by the BRICS countries to finance infrastructure and sustainable development in member and other emerging economies
A currency-swap safety net among BRICS members to provide short-term liquidity support in the event of balance of payments pressure — the monetary counterpart to the NDB's development lending
The BRICS finance track's principal ministerial forum, meeting under the rotating chairship; the 2026 meeting was held in Jaipur
India's nodal department for multilateral financial engagement, including the BRICS finance track
Make socially desirable but financially unviable projects bankable
Key: Provides a capital grant to bridge the gap between a project's commercial return and the return investors require, so that projects with public value but weak cash flows can still attract private capital
Balance risk between the government and the private concessionaire in road projects
Key: The government funds a share of project cost during construction and pays the remainder as annuities over the operation period, so the developer does not carry full traffic and financing risk as under a pure BOT toll model
Improve project bankability
Key: Raise the credit rating of a project's debt so that long-term institutional investors, who face rating floors on what they may hold, can participate
Recycle capital locked in completed assets and attract long-term institutional investors
Key: Pool operating infrastructure assets into a listed trust whose units investors can buy, freeing the original developer's capital for new construction
Give investors long-term visibility of the project pipeline
Key: A published forward pipeline of infrastructure projects, so private investors can plan capacity and financing against a known sequence rather than reacting to individual tenders
Improve coordination and efficiency across infrastructure ministries
Key: A geographic information system-based platform integrating the plans of ministries and States so that road, rail, port, energy and telecom projects are sequenced together rather than in isolation
Open new avenues for private participation in transport infrastructure
Key: New Dedicated Freight Corridors, new High-Speed Rail Corridors, operationalisation of new National Waterways, and a Coastal Cargo Promotion Scheme
The seminar's premise is that the binding constraint on infrastructure in emerging economies is not the absence of capital but the absence of investable projects. Global institutional investors — pension funds, insurers, sovereign funds — hold enormous long-duration savings and would prefer long-duration infrastructure assets, but they cannot take construction risk, regulatory risk, currency risk or counterparty risk in unfamiliar jurisdictions, and most are barred by mandate from holding sub-investment-grade paper. That is the gap multilateral development banks are meant to close. They de-risk: taking first-loss positions, providing guarantees, lending in local currency, and lending their own credit standing to a project so its debt reaches a rating institutional money can hold. They improve bankability: helping structure contracts, allocate risk and reach financial closure. And their presence signals that a project has been appraised to an international standard, which is itself a form of investor confidence. India's own instruments map onto the same logic — Viability Gap Funding closes the return gap, the Hybrid Annuity Model reallocates risk away from the developer, credit enhancement lifts the rating, and InvITs recycle capital out of completed assets into new ones. The Finance Minister's formulation captures the principle exactly: public capital is a catalyst, not a substitute, and what private capital ultimately needs is not more money but confidence, stability, predictability and credible long-term frameworks.
Simple Analogy: A pension fund is a cautious lender who will only sign if someone reputable co-signs. The multilateral bank is the co-signer, and the government's grant is the deposit that makes the numbers work.
The push for MDBs to leverage their balance sheets harder and crowd in private capital is a standing G20 agenda item, and the NDB seminar is the BRICS expression of it
The NDB and the Contingent Reserve Arrangement, both created at Fortaleza in 2014, are the two financial institutions BRICS has built — one for development lending, one for liquidity support
The NDB and the Asian Infrastructure Investment Bank are frequently discussed together as emerging-economy-led complements to the World Bank and IMF, and as vehicles for greater voice in global financial governance
VGF, HAM, BOT and InvITs form the standard set of PPP instruments tested in Indian economy questions; HAM in particular is the model that revived road-sector PPP after BOT-toll defaults
InvITs are the market instrument behind India's asset monetisation approach — selling the cash flows of completed assets to fund new construction
The presence of the IRDAI Chairman on the panel reflects that insurers are among the largest potential sources of long-duration infrastructure capital, subject to their own prudential limits
GS Paper 2 > International Relations > Bilateral, Regional and Global Groupings; GS Paper 3 > Infrastructure and Investment Models
General Awareness > International Financial Institutions and Infrastructure Finance
General Awareness > International Organisations
BRICS institutions and infrastructure financing models are recurring UPSC Prelims and banking general-awareness topics
The BRICS multilateral development bank founded in 2014 at the Fortaleza Summit, headquartered in Shanghai, with initial subscribed capital of USD 50 billion and authorised capital of USD 100 billion
The BRICS currency-swap framework signed at Fortaleza with an initial size of USD 100 billion, providing short-term liquidity support against balance of payments pressure
A capital grant bridging the gap between a project's commercial return and the return private investors require, used for socially desirable but financially unviable projects
A road PPP model in which the government funds part of construction cost and pays the rest as annuities during operations, sharing risk with the concessionaire
A listed trust holding operating infrastructure assets, allowing developers to recycle capital and institutional investors to buy into stable infrastructure cash flows
Finance Ministers' and Central Bank Governors meeting — the principal ministerial forum of the BRICS finance track, held in Jaipur in 2026