CII recipe for infra development; response to Apex Committee

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New Delhi, Nov 23 (UNI) In an obvious reference to Planning Commission's move to draw out an action plan to fast-track infrastructure projects and leverage additional money for the sector, CII today suggested a slew of measures to speed up development of the sector, including setting up a National Infrastructure Facilitation and Monitoring Agency (NIFMA) and creating a Special Window for Refinancing Infrastructure Projects.

The Special Window will need to be created with the India Infrastructure Finance Co Ltd (IIFCL), a state-owned financial institution into infrastructure financing.

''The agency should be structured on a private-public-partnership (PPP) basis with a Board having equal representation from both the Industry and the government and should be headed by a prominent Infrastructure expert,'' the industry body said in a statement.

As infrastructure developers are reeling under the prevailing liquidity crunch and high interest rates, the projects are finding difficult to carry on as well as reach the stage of financial closures.

CII said while there was a lot of talk on infrastructure projects, there is no single agency available which carries the responsibility of facilitating implementation of infrastructure projects. Therefore, a Special Re-financing Window would ''provide the much needed boost'' to infrastructure sector, CII said.

CII also recommended a special drive to hasten the process of awarding contracts and commissioning of new infrastructure projects.

Planning Commission Deputy Chairman Montek Singh Ahluwalia is preparing a Report on infrastructure development for the Apex Committee, headed by Prime Minister Manmohan Singh.

The Apex Committee comprises of the big five-- Dr Manmohan Singh, Finance Minister P Chidambaram, Dr Ahluwalia, Commerce and Industry Minister Kamal Nath and RBI Governor D Subbarao.

Dr Ahluwalia is on record as having said that the government plans to leverage 150 billion dollars for which the projects are being identified. The Commission is also looking at existing projects which have a greater absorptive capacity.

The government had targeted 500 billion dollars for funding infrastructure projects, of which it has identified funding and projects totaling 350 billion dollars. Now it is working out ways to arrange funding worth 150 billion dollars.

CII said there was need to identify 20 to 30 infrastructure projects of national importance and put them on fast track.

CII suggested floating tax free bonds to raise finance from the public at large for funding infrastructure initiatives.

The Confederation spoke the language of the Prime Minister, saying that infrastructure development was necessary as a contracyclical measure to combat the impact on Indian economy of the global slowdown.

''Everything necessary should be done to give a boost to and create an enabling framework for these investments, which are being planned over the next 10-12 years. Besides, by strengthening the supply side this has a huge positive spin off in terms of creating demand,'' CII said.


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