Union Finance Minister Nirmala Sitahraman on Sunday proposed to set up an Infrastructure Risk Guarantee Fund to provide calibrated partial credit guarantees to lenders. The finance minister in her Budget speech said during this past decade, the government has undertaken several initiatives for large-scale enhancement of public infrastructure, including through new financing instruments such as Infrastructure Investment Trusts (InVITs) and Real Estate Investment Trusts (REITs) and institutions like NIIF and NABFID.
Sitharaman proposes setting up of Infrastructure Risk Guarantee Fund
"To strengthen the confidence of private developers regarding risks during infrastructure development and construction phase, I propose to set up an Infrastructure Risk Guarantee Fund to provide prudently calibrated partial credit guarantees to lenders," she said.
Noting that cities are India's engines of growth, innovation, and opportunities, she said the government will now focus on Tier-II and Tier-III cities, and even temple-towns, which need modern infrastructure and basic amenities.
Sitharaman said this Budget aims to further amplify the potential of cities to deliver the economic power of agglomerations by mapping city economic regions (CER), based on their specific growth drivers.
"An allocation of Rs 5,000 crore per CER over five years is proposed for implementing their plans through a challenge mode with a reform-cum-results based financing mechanism," she said.
FM focuses on infrastructure development: key highlights
- Setting up Infrastructure Risk Guarantee Fund to provide prudently calibrated partial credit guarantees to lenders.
- Recycling of real estate assets of CPSEs through the setting up of dedicated REITs.
- Establishment of new Dedicated Freight Corridors connecting Dankuni in the East, to Surat in the West.
- Operationalising 20 new National Waterways connecting mineral rich areas, industrial centres and ports.
- Setting up of ship repair ecosystem catering to inland waterways.
- Launch a Coastal Cargo Promotion Scheme to increase the share of inland waterways and coastal shipping from 6% to 12% by 2047.
- Launching a Seaplane VGF Scheme to indigenise manufacturing.
- Rs 2 lakh crore support to states under SASCI Scheme.
- Purvodaya: Development of Integrated East Coast Industrial Corridor.
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