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The Indian government has unveiled a plan earlier this month to spend heavily on infrastructure projects to boost the nation’s faltering economy. India plans investments of $1 trillion over the next five years to revamp the country's creaky infrastructure, a major hurdle to its growth. The poor state of roads, ports, airports and other facilities shaves about two percentage points from India's gross domestic product growth, according to some estimates.

Under a program that envisions the expenditure of $1 trillion over the next five years, India will construct new roads, highways, airports, seaports, among other endeavors, amid worries that the economy is slowing due to currency weakness, inflation and tepid domestic demand. Prime Minister Manmohan Singh, who has come under criticism for his handling of the economy, seeks to revitalize growth and restore confidence of foreign and domestic investors by enacting a series of big-ticket investments.

Under the plan, the government will award contracts for building two ports and three airports, and will add 18,000 megawatts of power-generation capacity in the year that began April 1. The ports will be built on the eastern coast in Andhra Pradesh and West Bengal, and would cost $3.68 billion. The new airports will be in Kannur, in the southern state of Kerala, in Goa and on the outskirts of Mumbai.

The government, already under pressure to keep spending in check, can't meet the heavy investment needs alone. Mr. Singh said half the $1 trillion in investment would have to come from the private sector.

The plans come on the heels of data released last week that showed India's economy expanded 6.5% in the last fiscal year—its weakest pace in about a decade, because of a widening trade gap and poor investments. The country has been struggling with inflation and currency weakness. Domestic demand, which India's economy is largely reliant on, has also slowed in part due to the political upheaval.

The sharp slowdown stoked worries that India—considered, with its northern neighbor China, an engine of global growth—could slip into a deeper slowdown if immediate steps aren't taken to resume policy overhauls.

The government has been blamed for failing to push through some reforms, such as easing foreign direct investment rules in the retail sector. Other changes, such as allowing more foreign participation in the insurance and pension sectors, have also been held up for a long time.

A Subba Rao, chief financial officer of GMR Infrastructure, a company that is expected to win some of the infrastructure contracts that the government will award, told the network: "This is an excellent development to improve the sentiment across the infrastructure sector. If infrastructure will not grow, the economy will not grow.”

Singh warned, however, that the state alone could not incur the hefty $1 trillion price tag for these massive investments. "Therefore, importance is being given to public-private partnership. Achieving targets in key infrastructure sectors is key to success and will inspire confidence about the overall economic growth rate," he said.

Singh warned, however, that the state alone could not incur the hefty $1 trillion price tag for these massive investments. "Therefore, importance is being given to public-private partnership. Achieving targets in key infrastructure sectors is key to success and will inspire confidence about the overall economic growth rate," he said.