Pvt funding crucial for urban infra: FM

Gandhinagar: Finance Minister Nirmala Sitharaman on Sunday underlined the need for embracing innovative strategies to attract private investment, bridge financing gaps and foster sustainable development of infrastructure in cities.

Addressing the ‘G20 Infrastructure Investment Dialogue’, the minister said that the situation with regard to financing infrastructure has become even more challenging in the wake of monetary policy tightening in key markets.

The tight monetary policy leads to the hardening of interest rates and the burgeoning debt repayment burden. Against this backdrop, she said, “innovative financing and funding mechanisms for cities could have significant potential to fill the increasing (funding) gaps. It can complement the pool of funds available for infrastructure in addition to public investment and financing provided by Multilateral Development Banks (MDBs),” she added.

“We need alternate solutions to leverage private sector participation in this context. Innovative financing instruments such as blended finance, structured project finance, securitization, thematic bonds, biodiversity offerings...and local currency finance, are some of the needs,” Sitharaman said.