Seeking to continue with the impetus on maintaining growth and boost infrastructure spending, Finance Minister Pranab Mukherjee on Friday gave a whopping 46 per cent of the total Plan outlay, a lion's share of Rs.1.73 lakh crore, to the infrastructure sector including roads, ports, airports and railways in 2010-11.
“I propose to maintain the thrust for upgrading infrastructure in rural and urban areas,” Mr. Mukherjee said in Parliament. Of the total allocations for the infrastructure sector, those for roads and the Railways account for Rs.36,646 crore, an increase of about Rs.3,500 crore.
To make a visible impact on the road sector, the government has made changes in the policy framework for public-private-partnership (PPP) projects and has targeted construction of national highways (NHs) at the pace of 20 km a day. The allocation for the road transport sector has been increased by 13 per cent.
For 2010-11, the allocation for road transport has been raised by over 13 per cent from Rs.17,520 crore to Rs.19,894 crore. The allocation for the Railways is up by Rs.950 crore to Rs. 16,752 crore in 2010-11 to help it expand its network. The Delhi-Mumbai Industrial Corridor project has been taken up for integrated regional development, to complement the dedicated freight corridor, Mr. Mukherjee said.
On India Infrastructure Finance Company Ltd. (IIFCL), set up by the government to provide long-term financial assistance to infrastructure projects, he said its disbursements were expected to touch Rs.9,000 crore by March 2010 and reach around Rs.20,000 crore by March 2011.
IIFCL has also been authorised to refinance bank lending to infrastructure projects. It had refinanced Rs.3,000 crore in the current year and is expected to more than double that amount in 2010-11, he added. The take-out financing scheme announced in the last budget is expected to initially provide funding of about Rs.25,000 crore in the next three years. The scheme refers to banks selling their loan book from infrastructure companies to IIFCL.
