IIFCL to double its lending over the year.
Finance Minister Pranab Mukherjee today allocated a large chunk of the total plan outlay of Rs 373,000 crore for 2010-11 to infrastructure sectors, including road, power, railway, ports and airports.
“I propose to maintain the thrust for upgrading infrastructure in both rural and urban areas,” Mukherjee said, while presenting the budget in Parliament today. Over 46 per cent of the total plan allocation – Rs 173,552 crore – for 2010-11 has been earmarked for infrastructure development. Last year, the proportion was around 30 per cent.
Mukherjee more than doubled the plan allocation for power to Rs 5,130 crore for the next financial year. A major portion of this corpus was directed at the Restructured-Accelerated Power Development and Reforms Programme (R-APDRP) to bring down distribution losses and improve capacity addition.
To build the corpus of the National Clean Energy Fund set up earlier, Mukherjee also announced a cess on coal production at a nominal Rs 50 per tonne. This will be levied on imported coal, too. Around 75 per cent of the power generated in the country is coal-based.
In another step at cutting domestic carbon emissions, the government increased the plan outlay for the renewable energy ministry by 61 per cent to Rs 1,000 crore for 2010-11. The ministry is implementing the ambitious National Solar Mission, aimed at setting up 20,000 Mw of solar power capacity by 2020.
Budget 2010-11 provided a concessional customs duty of five per cent for solar power generating equipment. “I propose to exempt a few more specified inputs required for the manufacture of rotor blades for wind energy generators from central excise duty,” the FM added.
Allocations for roads and railways together were over 36,600 crore, an increase of Rs 3,300 crore. Mukherjee said the government has made changes in the policy framework for public-private-partnerships to make a visible impact on the road sector. It has also targeted construction of national highways at the pace of 20 km a day.
Mukherjee also said disbursements of the India Infrastructure Finance Company, set up to provide long-term financial assistance, would touch Rs 9,000 crore by March 2010 and reach around Rs 20,000 crore by March 2011. He said the take-out financing scheme, where banks sell their loan book from infrastructure companies to IIFCL, announced in the last Budget, was expected to provide funding of Rs 25,000 crore over the next three years.
