The fundamental mismatch is structural. Infrastructure projects typically require 7 to 15 years from conception to stabilised returns, whilst Indian capital markets reward quarterly performance and penalise companies that tie up capital in long-gestation assets. Private equity investors want exits within five years. Stock markets punish infrastructure companies whose earnings remain suppressed during construction phases.
This creates perverse incentives. Developers rush projects to generate early cash flows, compromising quality. Cost overruns become endemic because initial budgets were designed to attract impatient capital rather than reflect realistic timelines. Projects are abandoned midway when returns do not materialise quickly enough, leaving half-built assets and stranded investments.
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