Releasing the 'Report to the People' on the performance of the UPA government during the last three years (2004-07), Prime Minister Manmohan Singh today said exception would be made for borrowing funds from the National Small Savings (NSC) Funds by the state-owned India Infrastructure Finance Corporation Ltd (IIFCL) -- a move aimed at overcoming resource crunch for creating world-class infrastructure.
He said IIFCL, formed as a special purpose vehicle for providing long-term loans to infrastructure projects, had sanctioned 47 projects estimated to cost around Rs 55,000 crore. Out of these, 16 projects worth Rs 9462 crore have been given in principle approval under the viability gap funding scheme.
''The twin schemes for viability gap funding and long-term debt to infrastructure projects address critical gaps in private sector financing of infrastructure and ensure that infrastructure projects rendered unviable due to long gestation periods are not not neglected due to unavaliability of long-term debt,'' points out the report.
Through this package, the government had leveraged scarce budgetary resources for attracting a large pool of private capital, it said.
Over the past few years, mutual funds have been cornering a large chunk of the stock markets almost at par with FIIs. The reason for this is that a retail investor finds the mutual fund as the only safe haven for investment in the stock market which has been in a state of boom for the past several months.
Time and again the retail investors have burnt their fingers by investing in bourses but now mutual funds are finding investment in infrastructure projects as a profitable proposition, given the liberal terms of the Model Concession Agreements, many of which have already been finalised.
The report card gives ample indications that from investment in manufacturing, a significant amount of mutual fund money is now likely to flow in infrastructure projects, including ports, airports and highways.