IDFC Chief calls for more pvt participation in infrastructure

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Mumbai, Sep 21 (UNI) Close to 9.1 per cent of the domestic private sector savings will have to be pumped in to the infrastructure space by 2011 in order to sustain the current growth momentum, said IDFC Chief Rajiv Lall while addressing the IIF Asia Regional Economic Forum in Mumbai.

Also, a significant acceleration in insurance and foreign equity capitals should be ensured to bring down the burden on banking sector which is a major investor in the segment at present, he said.

''There is a huge shortage of infrastructure in the country when compared to that of other emerging economies like China. Only an effective public-private partnership in infrastructure sector can extend the desired support to the growing economy,'' Mr Lall pointed out.

The annual GDP contribution in infrastructure is expected to scale up to 9 per cent from the current 5 per cent while nearly 3 per cent (around USD 58 bn) will be sourced from private sector as against 1.1 per cent currently.

As per the current estimates, India will need nearly USD 570 billion investment in the infrastructure sector in next five years.

However, the low credit availability to the sector still continues to be a matter of concern which is at a mere 21 per cent currently and is expected to go up to 93 per cent by 2011.

''The regulatory environment is clear enough to invite transparency in infrastructure investments. We need more foreign equity capitals and more acceleration in the insurance segment to avoid burden on banks,'' he added.

UNI

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