Budget Impact on Infrastructure Sector


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Budget Impact on Infrastructure Sector

  1. 1. Budget Impact on Infrastructure SectorSubmitted to : Dr. Saji KumarBy : Roll No. 41-50
  2. 2. Infrastructure in Budget 2012-13
  3. 3. •During Twelfth Plan period, investment in infrastructure to goup to Rs. 50 lakh crore with half of this, expected from Privatesector.•Tax free bonds of Rs. 60,000 crore to be allowed for financinginfrastructure projects in 2012-13.•More sectors added as eligible sectors for Viability GapFunding under the scheme Support to PPP in infrastructure•Government has approved guidelines for establishing jointventure companies by defence PSUs in PPP modeHighlights - Pandya
  4. 4. •FirstInfrastructure Debt Fund with an initial sizeof Rs. 8,000 crore launched earlier this month.•A harmonised master list of infrastructure sectorapproved by the Government•IIFCL has put in place a structure for creditenhancement and take-out finance for easingaccess of credit to infrastructure projects.Highlights (Contd.) - Batuk
  5. 5. National Manufacturing Policy•National Manufacturing Policy announced with theobjective of raising, within a decade, the share ofmanufacturing in GDP to 25 per cent and creatingof 10 crore jobs. Power and Coal•Coal India Limited advised to sign fuel supplyagreements with power plants, having long-termPPAs with DISCOMs and getting commissioned onor before March 31, 2015.•External Commercial Borrowings (ECB) to beallowed to part finance Rupee debt of existingpower projects.Highlights (Contd.) - Kale
  6. 6. •Target of covering a length of 8,800 kilometerunder NHDP next year.•Allocation of the Road Transport and HighwaysMinistry enhanced by 14 per cent to Rs. 25,360crore.•ECB proposed to be allowed for capitalexpenditure on the maintenance and operations oftoll systems for roads and highways, if they arepart of original project.•Direct import of Aviation Turbine Fuel permittedfor Indian Carriers as actual users.Transport: Roads and CivilAviation - Ravi
  7. 7. •ECB (external commercial borrowing ) to bepermitted for working capital requirement of airlineindustry for a period of one year, subject to a totalceiling of US $ 1 billion.•Proposal to allow foreign airlines to participateupto 49 per cent in the equity of an air transportundertaking under active consideration of thegovernment.•Full exemption from import duty on specifiedequipment needed for road construction, tunnelboring machines etc Sahil
  8. 8. Transport: Roads and CivilAviation (Contd) Delhi MumbaiIndustrial Corridor•In September 2011central assistance of18,500 crore spreadover 5 years approved.US $ 4.5 billion asJapanese participationin the project.• Shyam
  9. 9. •Measures will ease financing constraints faced bycertain infrastructure segments and spur growth.•The access to viability gap funding for irrigationprojects will improve private sector participation inthe sector.•Construction companies, power companies andport development companies will be benefited bythe lowering of withholding tax on ECB to 5percent from 20 percent.•Power sector will further get a boost through theavailability of tax-free bonds.•Surajit
  10. 10. • Impact Analysis Y-o-Y growth of allocation toinfrastructure including power, road transport,shipping ,urban infrastructure, and railwaystogether has increased by a mere 7.4 percent ascompared to 36.0 percent in 2011-12.•For sectors such as port, allocation of tax freeinfrastructure bonds remain unchanged at Rs.50billion. While this will facilitate development of Portinfrastructure, the impact on these sectors will beneutral ,if not negative.•Sandy
  11. 11. •Healthy infrastructure spending holds the key tofacilitating economic growth in India.•Inadequate infrastructure has time and againexposed the Indian economy to supply sideconstraints.•Although the Y-0-Y growth in infrastructure hasbeen less than expected the mechanisms forfunding has been enhanced and it augurs well forthe overall development of infrastructure sector.•Steffi