Funds no constraint for developing infrastructure

The government on Saturday said inadequate infrastructure was retarding the country's economic growth by 1.5-2.0 per cent every year and that constraint of funds would not be allowed to come in the way of developing infrastructure.

"To address the need for long-term funds for infrastructure projects the government has set up the Indian Infrastructure Finance Corporation (IIFC) with Rs 10,000 crore," Finance Minister P Chidambaram said after inaugurating the conference of State Chief Secretaries on Public Private Partnership.

"However, there will be no limit to funds if there are viable long-term projects to be funded," he said.

The IIFC has written to all state governments inviting proposals for infrastructure projects.

Chidambaram said that while there were institutions like the IDFC to meet the long-term funding needs of the infrastructure sector, the demand in turn was also huge.

To make private participation in infrastructure projects viable, the government has started a viability gap funding scheme.