New Delhi: Increasing public and private investment is a key priority of the government, said Arvind Subramanian, chief economic advisor in the finance ministry, on Friday, adding that it is the right time for infrastructure firms to make investments to benefit from lower commodity costs.
“The government has ambitious plan for public investment. Railways, roads, micro irrigation and other sectors will receive high priority from the government,” he told investors at an infrastructure conference organized by the ministry of finance just ahead of the Union budget which is to be presented on 29 February.
The conference is aimed at attracting domestic and foreign investors to India.
The external environment provides a positive shock for infrastructure, he said, adding that “low commodity prices means that firms can get greater return on investments”.
Projecting India as an attractive destination, Subramanian said the country’s macroeconomic stability remains one of its key strengths.
Speaking at the event, minister of state for finance Jayant Sinha said that the government is committed to provide a rules based predictable regime to investors.
He pointed out that investors have the option of investing in three kinds of projects. Brownfield projects that were nearing completion but are stuck due to lack of finance, greenfield projects where development risk persists and those Greenfield projects which are nearing completion and will provide high cash return yields.
H.R. Khan, Reserve Bank of India deputy governor, said the central bank is willing to relax its guidelines to encourage investments.
“No guidelines are cast in stone. If there are any ambiguities or difficulties that are caused by existing regulations, RBI is open to looking at them,” he said.
