CHENNAI: Flagging that “free is the most expensive word in public policy”, chief economic adviser (CEA) Anantha Nageswaran said infrastructure built on the promise of free or below-cost services cannot attract patient capital. “What makes infrastructure worthy of patient capital? There are three conditions: quality infrastructure, contract certainty, and policy certainty. And the fourth, which we find harder to say aloud: durable returns rest on two things—a price that covers the economic cost of a service, and a public willing to pay a fair charge for it. There is no third way around it,” he said.Infrastructure built on the promise of free or below-cost service cannot support patient capital. It is a contradiction written into the balance sheet. Someone always ends up paying; either the user pays a fair charge, the taxpayer pays a hidden one, or the asset itself pays through slow decay due to a lack of maintenance. Free is the most expensive word in public policy,” he said at the Tamil Nadu Infrastructure Summit, organised by CII.
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