By: Archana Girish Kamath
India’s overseas investments in infrastructure have been growing, including with the support of the Indian government’s foreign assistance programs. Such financing has sometimes involved grants and lines of credit for international ports, roads, and railway infrastructure and have been used to build supply chain resilience through investments in infrastructure in strategic locations. However, the Indian private sector’s investments in overseas transportation infrastructure have received far less attention, despite important projects in countries such as Bangladesh, Greece, Indonesia, Israel, Mauritius, the Philippines, Qatar, Saudi Arabia, Tanzania, and Vietnam. Private investment differs from state-backed financing in that the Indian government has a limited ability to invest strategically or manage assets. However, private companies’ overseas financing of transportation projects still brings direct and indirect benefits to India such as improved connectivity, the potential for international collaboration, and denial of access to potential competitors.
Over the last decade, Indian private companies have invested over $9 billion overseas in transportation infrastructure, based on a comprehensive analysis of outbound investment flows from the Reserve Bank of India. The top three Indian private companies in overseas transport investment were the Adani Group, the GMR Group, and Larsen & Toubro (L&T), which together accounted for more than two-thirds of this total. Nonetheless, this amount represents only a small fraction of all outbound Indian investment. For comparison, India’s total Overseas Foreign Direct Investment (OFDI) during this same period was about $262 billion.
Most such outbound private Indian investment in the transportation sector has been of two varieties. One involves ownership or management for a certain period through an equity stake or concession agreement. For example, in 2023, the Adani Ports and Special Economic Zone (APSEZ) acquired a 70% equity stake in the Haifa Port Company with an investment of close to $1.2 billion. APSEZ has also operated and managed a container terminal at the Dar es Salaam Port in Tanzania since 2024, through a 30-year concession agreement. APSEZ is currently in talks with Vietnam’s government about a $2 billion investment in the Lien Chieu Port Project. Similarly, in 2019, GMR Airports signed a 35-year concession agreement (through a joint venture) for the new Heraklion International Airport, which is expected to be the second busiest airport in Greece. GMR Airports also has a presence in the Philippines, having previously developed and operated the Mactan-Cebu International Airport, and recently committed to developing the Sangley Point International Airport. Furthermore, GMR Airports holds a 49% stake in the Kualanamu International Airport in Indonesia.
By contrast, a different model, and one frequently pursued for road and railway contracts, is the Engineering-Procurement-Construction (EPC) model. Here, the private entity’s role ends with the completion of construction. L&T has been involved in several transportation EPC projects overseas. For example, L&T secured a contract to extend a Mauritian metro corridor in 2021. L&T also has a significant presence in Saudi Arabia, having won a $161 million contract to build tracks for Riyadh Metro in 2015, and is now a part of a global consortium that was awarded a contract for the extension of a metro line. Closer to home, L&T completed an electrical and mechanical system integration project for a metro line in Dhaka, Bangladesh in 2022. L&T was also involved in the construction of the Al Wakrah Bypass Expressway Road Project, which connects Doha to the biggest port of the country, the Hamad Port. Additionally, L&T won a contract to build an integrated railway system extending Jakarta's existing Mass Rapid Transit in 2024. Such EPC projects are particularly important given China’s similar history of engagement with many of these countries.
While the Indian private sector’s overseas investments are evidence of the country’s expanding commercial and business interests, the infrastructural assets involved increase India’s strategic stakes. This expanding presence also offers scope for international collaboration. For example, the Haifa Port is a crucial link in the India-Middle East-Europe Economic Corridor, and L&T’s metro project in Dhaka was supported by a project funded by the Japanese International Cooperation Agency. Whatever the mode of involvement, one thing is certain: the Indian private sector’s investments are an important part of India’s expanding global strategic footprint.
Archana Kamath is a Summer Intern at ORF America.