Need for an infrastructure financing fund: Assocham

For a better financing to various infrastructure projects, the Associated Chambers of Commerce and Industry (Assocham) Sunday asked the government to set up a ‘separate infrastructure financing fund’ worth $90 billion and pool it through public-private partnership in the next two-three years.

In a note submitted to the Planning Commission and the Reserve Bank of India (RBI), Assocham secretary general D. S. Rawat said, “States and Centre together should pool their resources to set up such a fund exclusively to cater the requirement of infrastructure financing.”

Assocham has suggested the government to fill up the fund through the contributions of Central and States governments, public sector undertakings and private sector contribution.

According to the trade body, Centre can inject $12-billion, states and its enterprises can raise $12-billion, and the central public sector undertakings can contribute around $35 billion while private sector can pump up to $30-billion to the fund.

Calling to commercial banks and non-banking finance companies (NBFCs) it suggested that commercial banks should doubled the credit from 10 to 20 percent while NBFCs should be motivated to increase their support base for infrastructure projects.

Stressing on completing the projects through public-private partnership, the umbrella body of chambers of commerce said that the Centre must explore ways and means through public-private partnership projects to upgrade their infrastructure and civil amenities.

Moreover, the industry lobby also urged the government to set up state-level highway authorities with modern management systems and state level dedicated road funds.