New Delhi, India — India's finance minister is urging foreign investors to help plug enormous gaps in the country's infrastructure blamed for holding back growth.
"We are waiting for you," Arun Jaitley told a roomful of international and Indian CEOs attending the India Economic Summit, one of the World Economic Forum's satellite summits held around the globe.
Prime Minister Narendra Modi has enchanted Indians with his vision of a country crisscrossed by modern roads, high-speed trains, dozens of high-tech smart cities and universal Internet cables.
To get there, India has a long way to go.
The country is beleaguered by a patchy network of pot-holed roads, lumbering railway service and a lack of warehouses that leads to some 40 percent of the country's produce and grains going to rot.
The country loses about a quarter of the electricity it generates through a leaky, inefficient grid. And hundreds of millions still have no proper home or access to sanitation facilities.
Economists estimate India needs a staggering $1 trillion in infrastructure investment alone. That's more than half India's entire gross domestic product for 2013 of $1.87 trillion.
"Infrastructure, let me tell you, we welcome large investment participation, even international participation," Jaitley said. He said legislative reforms to open industries such as real estate, railways services and even defense would be easy to sell in a country sometimes wary of big change.
Modi, under pressure since taking office in May to boost the economy, has visited countries including Japan, the United States and Australia with the goal of building business ties. He also hosted Chinese President Xi Jinping in September and plans to host Russia's President Vladimir Putin in December.
The efforts so far have yielded $100 billion in new business, Modi said last month.
Jaitley on Wednesday ruled out eliminating all Indian subsidies, which at 2 percent of the country's GDP act as a heavy weight on government finances.
The best the government can do is rationalize those expenses, he said, and noted the cost of diesel had recently been pegged to world market prices so that the government would no longer have to cover the difference between import costs and state-set prices.
Investors, optimistic about India's economy under Modi, helped push GDP growth up to 5.7 percent in the first quarter, after two straight years of economic malaise with the rate under 5 percent. Modi has promised to get growth back up to the 8 percent it averaged for a decade up to 2012.
Jaitley reassured investors that the government would push through an economic overhaul, but would do so carefully so as to avoid making any move "which sends a contrary signal."
"You can damage the economy with one bad idea," he said, citing the previous government's decision to impose taxes retroactively on companies. Modi's government has not yet reversed that decision.