**As expected, these overall patterns have been largely driven by India, which contributes the biggest share of total infrastructure investment in South Asia during the 1973-2009 period.** In fact, infrastructure investment in India makes up on average 79 percent of total investment in the region (Figure 3). The second largest contributor – Pakistan – merely has an average share of 12 percent, and is followed by Bangladesh with 7.9 percent, Nepal with 1.0 percent, and Bhutan with 0.2 percent. These differences in the shares of total infrastructure investments in the region are roughly in line with the relative size of each economy. The average infrastructure investment as a percentage of GDP for the period 1973-2009 hovers around 6 percent for India, Pakistan, and Bangladesh, and 5 percent for Nepal. Bhutan with infrastructure investments representing 14.6 percent of its GDP has given significantly higher importance to infrastructure development.

**Figure 3: India Leads the SAR Pack in Infrastructure Investment**

( _Share in Total Infrastructure Investment by Country, 1973-2009)_ <!-- Start of picture text -->
1.0%  11.9%  7.9% 0.2%  Bangladesh<br>Bhutan<br>India<br>79.2%<br>Nepal<br>Pakistan<br>Sources:  Data has been collected from the public investment plans for each country.<br><!-- End of picture text -->

# **5.2 Private Sector Investment**<sup>15</sup><sup>**,16**</sup>

**India clearly has the largest presence in terms of private sector participation in infrastructure development at 85 percent of regional investment commitments.** While India dominates each subsector, it is interesting to note: i) there is a large investment in energy compared to the other subsectors, and ii) India is the only country where the private sector has invested in water and sanitation (Table 5). Pakistan and Bangladesh rank second and third in terms of private sector investments, followed by Sri Lanka and Afghanistan (primarily telecom). Furthermore, India is the country that, after Bhutan and Maldives, has the highest proportion of investment commitments with respect to GDP.

**The energy sector received the highest private sector investments not just in India but also in SAR.** From 1990-2012, the energy sector received US$155 billion in private investments. In 2012, 67 energy projects alone reached financial closure and a total of US$11.4 billion was invested – although this amounted to about half the investment in the previous year.<sup>17</sup>

> 15 The core source for private sector investment is the World Bank Private Participation in Infrastructure Database (for a detailed explanation on the PPI methodology, refer to: <u>http://ppi.worldbank.org/resources/ppi_methodology.aspx). In this</u> section, Private Participation in Infrastructure (PPI) investment consists of all eight countries in the region - Afghanistan, Bangladesh, Bhutan, India, the Maldives, Nepal, Pakistan and Sri Lanka.

> 16 Irrigation is not included in the definition of infrastructure for this section. This is primarily because there is not enough data available but also because irrigation is primarily a public sector domain.

> 17 Source: http://ppi.worldbank.org/explore/ppi_exploreRegion.aspx?regionID=6

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