The Centre intends to use pension and insurance funds to provide long-term finance for infrastructure projects and ease pressure on banks, according to Mr Gajendera Haldea, Adviser to Deputy Chairman and Principal Adviser (Infrastructure), Planning Commission.

“We hope in a couple of months the initiative will be implemented as the Finance Ministry has been working on this. We hope this will happen [in the Budget],” he said. The fund will lend for projects at a competitive interest rate, he told newspersons on the sidelines of the Annual Convention of the Madras Management Association.

Mr Haldea said in the first two years, it could be a $10 billion fund, and the amount could be increased thereafter depending on its success. The pension and insurance regulators are being consulted on this.

Nearly $1 trillion will be required for investment in infrastructure projects in the 12{+t}{+h} Plan, even as the gap in availability of infrastructure fund will be nearly $100 billion, he said.

Spectrum issues

Referring to the ongoing spectrum allocation controversy, Mr Haldea said there should be standardisation of the way the spectrum was allotted. The telecom contracts are awarded based on licence fee and not based on a standardised contract. These are problems of spectrum allocation that is being looked in to.

Three years ago, the Prime Minister initiated major regulatory reforms. “We are in the process of consultation with various ministries to build a consensus on regulatory reforms. If the reforms are brought in, some of the present issues will be minimised in every sector, including telecom,” he said.

There is a draft on the Reforms Regulation Bill, which is undergoing consultation. A copy of this is available on the Web site www.infrastructure.gov.in, he said.

Earlier while inaugurating the convention, Mr Haldea said the Indian economy should invest nearly 9 per cent of its GDP in infrastructure. China and other developed economies are investing over 9 per cent of their GDP on infrastructure while India invests just around 5.3 per cent.

There was a structure shift in infrastructure spending from 4.3 per cent of GDP in 2002-03 to 8.37 per cent. “There is a massive shift taking place in the infrastructure sector,” he said.

According to Mr Adil Zainulbhai, Managing Director (India), McKinsey & Company, the business opportunity in India ought to be unlimited in every sector. Global companies have also understood this. This will make India much more competitive and put pressure on ‘all of us' to be more productive.

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