Govt to unveil new Infrastructure Trust Fund within 2 months: Arvind Mayaram

Following the footsteps of countries like Singapore, Hongkong and USA, the Indian government is also set to launch a new Infrastructure Trust Fund (ITF), said Arvind Mayaram, Secretary, Department of Economic Affairs, adding that the structure will be finalized in next two months.

Mayaram said that under the new structure of Infrastructure Trust Fund, the underlying revenue of project will be transferred to a trust and the trust will issue units to investors, including private and foreign investors.

"Infrastructure Debt Funds (IDFs) through innovative means of credit enhancement is expected to provide long-term low-cost debt for infrastructure projects. The cost and tariff of infrastructure services are likely to go down as a result of low cost long term debt provides by IDFs," said Mayaram at an ASSOCHAM event.

Mayaram said that off-shore institutional investors, off-shore High Net worth Individuals, & other institutional investors may also be allowed to invest in the new fund.

The income of infrastructure debt funds has been exempted from income tax. The reduction in withholding tax has also been allowed on interest payment on borrowings of IDFs from existing 20 per cent to 5 per cent.

Dion Global Solutions Ltd.

Story first published: Monday, September 23, 2013, 9:10 [IST]
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