The finance ministry today said that the modalities for infrastructure debt funds,announced in the Budget 2011-12,will be finalised by June to help the infrastructure funding requirements,pegged at $1 trillion during the 12th Plan period (2012-17). We are hoping to get it (guideline for infra debt fund) out by the end of first quarter,by June this year, department of economic affairs secretary R Gopalan told reporters on the sidelines of a CII event. Also,the department is working on coming out with a new infrastructure definition,which is likely to be referred to a committee of secretaries,he added. In the Budget for the next fiscal,finance minister Pranab Mukherjee had announced setting up of infra debt funds through special purpose vehicles for attracting foreign investment in the infrastructure sector. To attract foreign funds for financing of infrastructure,I propose to create special vehicles in the form of notified infrastructure debt funds, he had said. Last year in June,an expert panel headed by HDFC chief Deepak Parekh had recommended setting up such a fund with an initial corpus of Rs 50,000 crore to meet the financial needs of the sector. According to sources,the proposed infra debt fund would have relaxed capital adequacy norms and its income would be exempt from tax. The interest paid by the fund to non-residents would be taxable at 5 per cent. The sources said it is likely that the RBI would be the regulator for such funds. On the definition of infrastructure,Gopalan said,We are going to Committee of Secretaries for the infrastructure definition and a decision would be taken after that. Currently,power,road,ports and industrial parks are among some of the segments that have been included in the infrastructure sector. Retail,real estate and health are the major sectors that are demanding infrastructure status.
