Business   

Big thrust on infrastructure through ‘takeout financing’

NEW DELHI: Backing the Union Finance Minister’s announcement for a massive spend on financing of infrastructure projects to give a big thrust to economic growth in the country, India Infrastructure Finance Company (IIFCL), which raised Rs. 10,000 crore in the last fiscal for refinancing banks for infrastructure lending, on Tuesday said the banks might avail themselves of this facility in the next six to seven months.

Seeking to step up the accelerator on economic growth and generate demand, Finance Minister Pranab Mukherjee had announced that IIFCL and banks were being equipped to finance and support projects involving investment worth Rs. 1,00,000 crore through the adoption of the ‘takeout financing’ scheme to facilitate incremental lending to the infrastructure sector.

Similarly, the Finance Minister also announced 23 per cent increase in allocation for the National Highways Authority of India (NHAI) to Rs. 8,578.45 crore for the National Highways Development Project (NHDP) for 2009-10. IIFCL, set up as a special purpose vehicle for providing long-term financial assistance to infrastructure projects, would be given greater flexibility, he said. “The government has decided that IIFCL will refinance 60 per cent of commercial bank loans for PPP projects in critical sectors over the next 15 to 18 months through the takeout financing scheme which is an accepted international practice of releasing long term funds for financing infrastructure projects,” he added. The allocation for the Railways has been increased to Rs. 15,800 crore in 2009-10 from Rs. 10,800 crore. Rural infrastructure has seen an increase of 45 per cent over the budgetary estimate of 2008-09 for six schemes. The Indira Awas Yojana got Rs. 8,800 crore. The government has also stepped up the allocation for the Jawaharlal Nehru Urban Renewal Mission by 87 per cent to Rs. 12,887 crore. “To improve the lot of the urban poor, the allocation for housing and provision of basic amenities to them has been done at Rs. 3,973 crore in the budget. In the power sector, the Accelerated Power Development and Reform Programme has witnessed a steep increase of 160 per cent to Rs. 2,080 crore.”

To expedite the completion of the Brihan Mumbai Storm Water Drainage Project, Rs. 500 crore has been earmarked in the budget. The total budgetary support for rural roads will be Rs. 12,000 crore for 2009-10, out of which Rs. 1,067 crore has been earmarked for the northeastern region and Sikkim. Rural roads have been identified as one of the six components of Bharat Nirman.

Printer friendly page  
Send this article to Friends by E-Mail

Stories in this Section

Toshiba JSW to set up turbine unit in Chennai
Recession-hit exporters get incentives
Prakash to raise $100 m
Automobile sector disappointed
Captains get together
Private producers to sell power to consumers
Firefox launches mountain bike at Rs. 91,000
Ford cuts Endeavour price
i20 automatic versions launched
STPI scheme: SMEs have different views
RIL-RNRL case hearing on July 20
Big thrust on infrastructure through ‘takeout financing’
Sensex recovers 127 points
Exchange Rates
Bullion Rates

Copyright © 2009, The Hindu. Republication or redissemination of the contents of this screen are expressly prohibited without the written consent of The Hindu