Set up $90-bn infrastructure fund, government told

New Delhi, April 26 (Inditop) The Associated Chambers of Commerce and Industry (Assocham) has urged the government to set up a “separate infrastructure financing fund” worth $90 billion to finance infrastructure projects in the next three years.

In a note submitted to the Planning Commission and the Reserve Bank of India (RBI), Assocham secretary general D.S. Rawat said the state and the central governments should pool their resources to set up such a fund to finance infrastructure projects till 2012.

According to Assocham, around $12 billion could be raised from the central government, while the central public sector undertakings could contribute around $35 billion to the fund.

The state government and its enterprises could generate around $12 billion and the private sector contribution would be within the limit of $30 billion.

Assocham further suggested that the credit extension from commercial banks for infrastructure projects be doubled from 10 percent to 20 percent.

Also, non-banking financial companies should be motivated to increase their support base for infrastructure projects, the chamber said.

The industry lobby further called upon the government to set up state-level highway authorities with modern management systems and state level dedicated road funds.

The central government must devise ways and means through public-private partnership projects to upgrade their infrastructure and civil amenities, Assocham said.