With the Union Budget 2013 announcement is approaching, industry stakeholders are seeking government support for a possible revival of their respective industry segment. Ami Mistry, Dhruba Purkayastha, Mohit Sinha and Prithweesh Ghosh present an insight into the current status of critical infrastructure segments and recommend some urgent steps needed in the coming Budget.
Category: Infrastructure Finance
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The level is rising
There surely is demand for timely and quality delivery of water and there is no lack of funds to support the projects. What is missing is the framework that can ensure that interest of all the stakeholders are taken care of, writes Sushi Shyamal.India is witnessing a sharp change in its demographic composition.
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Enhance plan allocation | Budget 2013-14
Aviation Finance Corporation (AFC), an SPV providing dedicated capital, can be set up by the government to facilitate lower interest rates and longer maturity of loans. Private airport operators should be allowed to issue long term non-taxable infrastructure bonds to raise the required funding from the market. RBI limits on sectoral funding should be eased, thereby removing the current compulsion for airport developers to raise required funds/debt from multiple banks, making process time consumi
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More clarity required on taxability | Budget 2013-14
Finance Act (2) of 2009 makes providing PAN details compulsory for certain eligible payments especially on account of freight. Failing which the deductor is expected to deduct TDS at a higher rate Being in logistic sector, the nature of business is such that we are dealing mostly with unorganised sectors where it is very difficult on our part to collect the PAN. Hence, the following is recommended.
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Remove bottlenecks | budget 2013-14
Given the backdrop of a modest 5.5 per cent GDP growth expected in FY13 and uncertainties on a global economic recovery, Union Budget 2013-14 assumes immense importance. It is imperative to stimulate domestic demand, that too through infrastructure creation because of its huge multiplier impact in terms of creating new jobs, enhancing productive capacity of economy and promoting inclusive growth.
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Build pace of reforms | Budget 2013-14
Most of the country's logistics resources are in urgent need of refurbishment. Setting up of a nodal cross-ministerial logistics body, providing infrastructure status to the wider transportation and logistics industry and dedicating higher financial outlay for logistics skill improvement is, therefore, advisable. TCI is in favour of a separate regulatory authority for better coordination between ministries for an integrated policy on the sector.
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Sebi clears $1 bn IDF of IIFCL
SK Goel, Chairman and Managing Director of India Infrastructure Finance Company (IIFCL) said that the firm got Securities and Exchange Board of India's (Sebi) nod to launch $1 billion infrastructure debt fund (IDF). IIFCL expects to operationalise the fund in a month. Of the $1 billion corpus, 50 per cent would be contributed by Indian investors and 50 per cent by foreign investors, he said at the launch of first credit enhanced infrastructure bonds.
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Ministry discusses funding options for key rail projects
Planning Commission DeÂputy Chairman Montek Singh Ahluwalia and Railway Minister Pawan Kumar Bansal discussed options for funding crucial railway projects. The rail ministry feels the need to raise its own resources to fund these projects. Steps to raise funds could include an across-the-board increase in railway fares, reports suggest.
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Rs 155 bn infra loans recast in Apr-Sep 2012
A large amount of loan given by banks to infrastructure companies were restructured in Apr-Sep 2012 period because of high interest rate, rise in debt levels among these firms, reports suggest.During this period, loan worth Rs 15,562 crore belonging to infrastructure companies were restructured, data from the corporate debt restructuring (CDR)
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Recovery in equip finance
V Lakshmi Narasimhan, Chief Financial Officer of Magma Fincorp expects recovery in the commercial vehicle and equipment finance segments during the second half of 2013-14. The recovery would have tangible impact on commercial vehicle and equipment finance.