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Railways, road, irrigation priority for infra funding: MoS Sinha

The government needs to solve on-ground issues for the infrastructure sector be able to boom, Minister of State for Finance, Jayant Sinha said in a panel discussion on infra spending at the IMF/Government of India conference.

He said railways, road and irrigation were the priority areas for infrastructure financing.

Sinha said one of the key challenges was the reluctance of contractors to take up tenders in remote areas.

He said there was a good mix of capital flowing into the sector and that MoUs had been signed with UK, Abu Dhabi and Russia.

Rakesh Mohan, Executive Director, IMF said power, telecom and ports were much more suitable for Public Private Partnership (PPP) projects. He said the government had to be clear on which areas of infrastructure needed public investment. He said railways, roads and urban infrastructure were difficult areas for PPP.

Vitor Gaspar, Director, Fiscal Affairs Department, IMF said the biggest challenge for PPP was excess savings across the world, but very little investment in the private sector. He said that for PPP to take off, the contract complexity needed to be tackled well. He and Mohan were of the view that public investment in India acted as a catalyst for private investment.