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 2026, organised by CII in Chennai on Monday.Noting that while water should be treated on a par with roads and power as infrastructure that must be planned, built, and paid for, he said it is instead priced at zero. “So we treat it as limitless. We waste it, and we underinvest in it. And then we are shocked when it runs out. The thing we call free is the thing we destroy. This is not a paradox. It is a policy choice, and it can be chosen differently,” he added.Earlier, P. Ravichandran, chairman, CII Southern Region, and president of Danfoss India, highlighted that significant capital was available for investment, but the scale and number of bankable infrastructure projects remained inadequate.
