National Infrastructure Pipeline Task Force stresses on sources of finance

New Delhi: The report of the Task Force on the National Infrastructure Pipeline (NIP) recommends diversifying financing sources, along with strengthening the existing means.

The final report for FY 2019-25 submitted to Finance Minister Nirmala Sitharaman on Wednesday also suggests monitoring of project execution and enhancing execution capacity of private sector participants.

It said that necessary steps or initiatives need to be undertaken in order to solve the challenge of stressed assets faced by banks and infra-NBFCs besides liquidity crunch faced by NBFCs, by encouraging usage of innovative mechanisms such as loan securitisation, InvITs, etc and increased participation of Infrastructure debt funds (IDFs), DFIs, among others.

The report noted that the deepening IDF markets and developing the asset-backed securitisation market for infrastructure could significantly relieve banks of current exposure in commissioned projects and enable them to direct more capital for greenfield projects.

"Taking note of the scarcity of long-term capital for infrastructure, the Task Force recommends regulatory revamp to enable significant participation of FPIs and FDI in IDFs, DFIs and securitisation markets in consultation with the RBI and the Securities and Exchange Board of India (SEBI)," it said.