Brics face constraints in mobilising private capital at scale: Sitharaman | Economy & Policy News

Brics economies face common structural constraints in mobilising private capital at scale, Union Finance Minister Nirmala Sitharaman said on Wednesday. 

Delivering her keynote address at a seminar on “Role of the new development bank in mobilising private capital in member countries” in Jaipur, Sitharaman said: “The challenge is not merely the availability of capital but the creation of confidence, stability, predictability, and credible long-term frameworks, which are essential to unlock sustained private participation across member countries.”

Sitharaman said the government believes public capital must act as a catalyst, not a substitute, for private investment. In support of this principle, it has carried out multiple reforms such as viability gap funding (VGF), hybrid annuity model (HAM), credit enhancement mechanisms, infrastructure investment trusts (Invits), National Infrastructure Pipeline (NIP), and PM Gati Shakti. 

The finance minister said the Union Budget of the current financial year (FY27) introduced several targeted measures to facilitate private-sector investment, including new dedicated freight corridors, new high-speed rail corridors, operationalising new national waterways, and the Coastal Cargo Promotion Scheme.

Multilateral development banks also play a critical role in de-risking investments, enhancing project bankability, and strengthening investor confidence to mobilise private capital at scale, she said.

“The government has strengthened its infrastructure ecosystem through sustained public capital expenditure and complementary structural reforms,” said the finance minister. “Public investment has expanded significantly compared to a decade ago, reflecting a deliberate strategy to create productive national assets across highways, railways, ports, logistics systems, digital infrastructure, and energy networks.”

Economic Affairs Secretary Anuradha Thakur said that development finance is moving into a phase where scale must be matched with resilience. “Capital mobilisation cannot depend solely on favourable conditions,” she said. “It must be anchored in frameworks that endure. Strengthening such frameworks is where multilateral collaboration can add lasting value.”