India to finalise scheme for infrastructure funds

CHENNAI - The central government is expected to finalise in the next few months its framework to attract long term funds for the infrastructure sector, with an aim to garner Rs.10 billion in the first two years, an official said Saturday.

The idea is to raise funds from pension and insurance sectors to fund the infrastructure projects. The union finance minister is expected to make some announcement in a couple of months’ time, Gajendra Haldea, advisor (infrastructure) to deputy chairman, Planning Commission, told reporters here after inaugurating the annual convention of the Madras Management Association (MMA).

According to him, the discussions with pension and insurance regulators are on a positive note, though some regulations need to be changed.

He said the plan to make available long term funds at competitive interest rates was being looked into.

Citing banks’ inability to provide huge sums on long term basis to infrastructure projects, he said there needs to be alternate source of funds.

According to him, the government is also working on regulations to plug the loopholes in the bidding process in infrastructure sectors like power.