Industry & Economy
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Infrastructure
Banks, FIs asked to raise funds for infrastructure projects
Our Bureau
New Delhi
,
Jan. 9
THE Government has asked a consortium of banks and financial institutions to catalyse an additional investment of Rs 50,000 crore over three years in infrastructure and manufacturing projects spread across several sectors including power generation, sea ports, airports, roads, tourism, telecommunication and urban infrastructure.
A fund would be set up for the purpose by the consortium that would include IDBI, IDFC, LIC, ICICI Bank and SBI. Loans to the projects would be extended at a concessional rate of 200 basis points below the Prime Lending Rate (PLR). The modalities for the creation of fund would be finalised by the Ministry of Finance by March 1.
"A consortium of banks and FIs under a lead institution will appraise major projects, and after ascertaining their economic viability, ensure that credit for both term loans and working capital is provided speedily at highly competitive rates of interest of 200 basis pointed below PLR," the Finance Minister, Mr Jaswant Singh, said.
He said that the investment that would be catalysed would be a mix-and-match of external commercial and domestic borrowings.
"To the extent warranted by circumstances, Government will provide all necessary help, including financial guarantees, appropriate risk mitigation measures and other financial resources to ensure availability of funds at reasonable rates of interest," Mr Singh said.
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