Finance Minister Pranab Mukherjee expects around 50 per cent of the total spending on infrastructure to come from the private sector by 2012, which will mark the end of the ongoing 11th Plan period. In the first three years of the Plan, nearly 30 per cent of infrastructure spending came from private sources.
“Nearly 30 per cent of the total spending on infrastructure sector during the first three years of the 11th Plan period has come from private sources. As we go into the next Plan period, we expect this proportion to go up to nearly 50 per cent,” Mukherjee said at the India Investment Forum.
Asking the global investor community to participate in the India growth story, he said India was looking forward to revert to the high gross domestic product (GDP) growth path, of an average of 9 per cent, and even find the means to cross the “double-digit growth barrier” in the next two years.
Recalling how the country managed to withstand the impact of the global financial meltdown, which pulled down the economic growth to 6.7 per cent in 2008-09 from 9 per cent in the preceding three years, he told global investors: “India presents an opportunity for investment that you cannot afford to miss.” India’s economic growth rate was 7.4 per cent in 2009-10 and is expected to be over 8.5 per cent during the current financial year.
He added the government was constantly trying to simplify the foreign direct investment (FDI) regime and to make it easily comprehensible to foreign investors. The government had last year recognised both ownership and control as being central to the FDI policy, and methodology for the calculation of indirect foreign investment in Indian companies had been clearly defined. A consistent policy on downstream investment had also been formulated. Another major initiative had been the complete liberalisation of pricing and payment of technology transfer fee, trademark, and brand name and royalty payments. These payments could now be made under the automatic route, he said.