Cabinet expands viability gap funding by Rs 2,100 cr for social sector

VGF is given to PPP projects and has been limited to economic infra so far; some Rs 6,000 cr would be given for such initiatives as VGF till 2024-25

The Cabinet Committee on Economic Affairs on Wednesday expanded the viability gap fund (VGF) scheme to social infrastructure, with a total outlay of Rs 2,100 crore over five years.

VGF is given on a public-private partnership model and has been confined to economic infrastructure projects so far. As much as Rs 6,000 crore will be given for economic infrastructure projects as VGF till 2024-25.  

The scheme will have two parts.

The first will cater to areas such as wastewater treatment, water supply, and solid waste management. These projects face bankability issues and poor revenue streams to cater fully to capital costs.

The projects eligible