Despite recent volatility in the financial markets, the world is still experiencing the greatest economic expansion in history. Asia is poised to grow faster than any other area in the next decade, but will not reach its potential unless it reduces the growing number of infrastructure bottlenecks. Current infrastructure in Asia lags behind international standards in quantity and quality in key areas such as water, waste disposal, energy and transportation. According to recent estimates by the Asian Development Bank, between $380 billion and $450 billion is needed annually for the next few years – but less than a third of that is being committed.

The gap between the supply and demand for infrastructure is not caused by lack of money in Asia or elsewhere. It is due to the deficit in good governance, the lack of sound public institutions and the inability of the local governments and the private sector to...