The Centre on Saturday said a revolving fund with an initial corpus of Rs 100 crore is being set up to assist state governments in developing infrastructure projects under public-private-partnership.
The fund, to be called 'India Infrastructure Project Development Fund,' will finance up to 75 per cent of projects' development expenses under public-private-partnership, Finance Minister P Chidambaram said at a conference on infrastructure.
He said the fund would be a revolving one that will get replenished from successful bid projects and will be topped up through budgetary support if there is a need.
Sources in the finance ministry said a scheme to set up the fund is ready and will be put up before the Cabinet Committee on Economic Affairs after the minister approves it.
The proposed fund will provide interest free loans to state governments in case bidding of projects is successful, and will be converted into grants if bidding fails.