New Delhi: India and the US are considering setting up a $ 10 billion infrastructure debt fund under the public-private-partnership mode to expedite investments in the infrastructure sector, Com-merce and Industry Minister Anand Sharma said on November 8.
The debt fund has been mooted by the India-US CEOs Forum that comprises 12 corporate leaders from each side and it could help India get resources to finance its $ 514 billion infrastructure investment plans.
“Both the governments will consider the recommendation… It is India-US infrastructure debt fund proposed by the CEOs Forum of $ 10 billion,” Sharma told re-porters on the sidelines of a CII meet here.
“Finance Minister (Pranab Mukherjee) and US Treasury Secretary (Timothy Geithner) are directly discussing what modalities should be adopted to put in place the infrastructure debt fund,” he added.
However, Sharma added that details of the proposed fund would be known after the two countries take a final call on it without a specifying timeline.
“The governments have yet to take a final view and put in place the modalities. In principle it has been agreed that the governments will be fully supportive of the recommendation,” Sharma said.
The fund would be operated on the public-private partnership (PPP) mode and it would help in meeting the country’s funding gap in the infrastructure sector, he said.
The India-US CEOs Forum is co-chaired by Tata Group chief Ratan Tata and and Head of Honeywell Corp. Dave Cote. The Indian CEOs include ICICI Bank CEO and MD Chanda Kochhar, Bharti group chief Sunil Bharti Mittal, HDFC chief Deepak Parekh and State Bank of India Chairman O.P. Bhatt.
The US is represented by the likes of McGraw Hill of Companies chief Terry McGraw, Pepsico CEO Indra Nooyi and Citigroup CEO Vikram Pandit, among others.
India has emerged as an attractive global investment destination as its infrastructure sector alone requires investment of $ 514 billion for the 11th Plan (2007-08 to 2011-12). Almost 30 percent of this investment is envisaged to come from private sources.
For the 12th Five-Year Plan (2012-13 to 2016-17), the investment in infrastructure is envisaged at $ 1 trillion.
Mukherjee had said that this magnitude of investment would require innovative modes of financing.