BRICS economies are seeking to strengthen the role of private capital in financing infrastructure and sustainable development, as policymakers acknowledge that public budgets and multilateral lending alone cannot meet the scale of investment required across emerging markets.
Speaking at a seminar on the role of the New Development Bank in mobilising private capital, India’s Finance Minister Nirmala Sitharaman said the challenge is not simply the availability of money. Her remarks at the Jaipur seminar instead emphasised the need for confidence, stability, predictable policy frameworks and bankable projects capable of attracting private investors over the long term.
Key Overview
- BRICS economies remain major contributors to global economic growth, but face common barriers to mobilising private investment at scale.
- Multilateral development banks can help de-risk projects, improve bankability and strengthen investor confidence.
- The New Development Bank is increasingly seeking to mobilise private and institutional capital alongside its own financing.
- Risk-sharing tools including guarantees, syndicated loans and co-financing structures can help limited public capital attract larger pools of private investment.
- Governments remain responsible for creating stable policy, regulatory and investment frameworks that make long-term projects commercially credible.
- NDB has already begun using syndicated and guarantee-based structures intended to increase private-sector participation in development projects.
- The emerging model places governments, development banks and private investors in complementary rather than competing roles.
Private Capital Moves Higher on the BRICS Agenda
The discussion in Jaipur took place alongside the BRICS Finance Ministers and Central Bank Governors meeting, bringing together policymakers, financial institutions, multilateral organisations, private-sector representatives, think tanks and academics.
Sitharaman argued that BRICS countries share a common challenge. Their economies require substantial investment in infrastructure, energy, transport, digital systems and other development priorities, but private capital does not automatically flow toward those opportunities.
The issue is often risk rather than a shortage of investable money. Investors may hesitate when projects face regulatory uncertainty, weak revenue models, execution risk or unclear frameworks governing long-term investment.
This is where multilateral development banks can play a larger role. By supporting project preparation, providing long-term financing and absorbing selected risks, they can make projects more attractive to commercial lenders and institutional investors.
The development-finance approach outlined in Jaipur therefore positions multilateral institutions as catalysts capable of attracting capital beyond what they can provide from their own balance sheets.
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NDB Builds a More Catalytic Financing Model
The New Development Bank has increasingly incorporated private-capital mobilisation into its strategy rather than relying exclusively on conventional sovereign lending.
Its 2022–2026 strategy identifies mobilisation of public and private resources as an important element of financing sustainable infrastructure and development across member countries.
One example came in 2025 when the bank participated in an RMB 1.2 billion syndicated financing supporting environmental projects in China.
Under that transaction, NDB provided RMB 717.32 million while another participating lender committed RMB 500 million. The financing supported equipment linked to wastewater treatment, solid-waste management and other environmental projects.
The significance of the structure goes beyond the individual loan. It demonstrates how a multilateral institution can participate directly in a project while also drawing additional financial institutions into the transaction.
Guarantees Can Multiply Development Capital
Guarantees represent another way development banks can mobilise capital without financing entire projects themselves.
NDB is pursuing this approach through a proposed South African Credit Guarantee Vehicle aimed at attracting private and long-term capital into infrastructure.
The proposed structure is intended to support sectors including energy transition, transport and logistics, water and sanitation, healthcare, education and housing.
Rather than providing all the required financing directly, a guarantee vehicle can absorb selected risks that would otherwise discourage institutional investors such as pension funds, insurers and commercial banks.
This creates a potential multiplier effect. A relatively limited amount of development-bank capital can help unlock substantially larger pools of private-sector money if investors gain sufficient confidence in the risk structure.
Bankable Projects Remain the Missing Link
Private capital mobilisation ultimately depends on more than financing mechanisms.
Projects need credible revenue models, transparent procurement, stable regulations, reliable counterparties and clearly allocated risks before investors will commit long-term capital.
NDB evaluations have highlighted the importance of strong policy frameworks, high-quality project documentation, experienced transaction advisers and effective engagement with the private sector.
This means governments also have a significant role in improving the investment pipeline. Projects that are poorly prepared cannot become commercially attractive simply because a development institution is willing to participate.
Creating bankable infrastructure therefore requires substantial work before financing is raised, including feasibility studies, regulatory preparation, risk allocation and financial structuring.
A Partnership Model for Future Development Finance
The central message emerging from the BRICS discussions is that future development financing will increasingly depend on partnerships between governments, multilateral institutions and private investors.
Governments can provide policy direction, regulation and enabling infrastructure. Development banks can offer technical expertise, long-term financing, guarantees and risk mitigation. Private capital can then provide the scale needed to fund projects far beyond the capacity of public balance sheets alone.
Sitharaman’s call for stronger development-finance partnerships reflects a wider shift toward using multilateral institutions not merely as lenders, but as platforms for mobilising additional investment.
For BRICS economies, the success of this model will ultimately be measured not by how much development banks lend themselves, but by how effectively they can convert limited public and multilateral capital into larger flows of commercially sustainable private investment.
Sources: Press Information Bureau / New Development Bank / Emirates News Agency
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